You can retire when you wish. I was 60 years old with only 200,000 in a divorce/business settlement. I had worked hard for 40 years many times 24/7 365. I started a business but decided I was no longer interested in working that hard anymore. So I took my monthly buyout of 2,300 and retired. I moved to Thailand where I support a family of 3 on about 1500 dollars a month. Then at 65 started drawing an additional 2300 from ss. I adapted my lifestyle from 200,000 a year to a little over 28,000 a year and I’m happy. So it’s really up to you and the lifestyle you chose to live.
I am originally from Europe and I live and work 25 years in the USA. I do have dual citizenships and I am planning to retire back in the EU. I was voluntarily paying my social security and health insurance in EU past 25 years just to keep them. I moved 48 times in my life and I lived in 11 different countries for more than one year, due to my work. I traveled 78 countries. I do understand very well what challenge it is to travel or to move to different country. It is not as simple as it sounds and if something goes wrong the reality will hit very hard. The legal challenges and cultural differences might look exotic and fun, but not in the long run. There is difference huge difference between 2 weeks vacation money and retirement money. Just to fly to certain locations from USA economy class is $1,500 - 2,000. The idea to retire in foreign country is very popular and it is doable. Traveling the world while retired on $2,000 budget and flying multiple times per year to the USA is unrealistic. Some people do zero research and there is so many challenges and issues people even don't think about. For example: If someone moves full time to country, which has no Social security agreement with the USA, that person can't collect social security. Also the "free" healthcare in Europe is becoming a myth, because Europe is trying to protect their health system from healthcare tourism. In lots of countries people can't stay longer than 30 - 90 days legally as tourists. There is a big difference between dreams and delusions.
I remember hitting $1.5 million at 56 and thinking, ‘This has to be enough to retire early, right?’ But then I realized there’s a lot more to it than just the amount. Having the money is one thing; knowing how to make it last is another.
James's advice about taking the retirement plan through test runs is a key point. Their experience may not replicate the travelers they follow. I know of a couple that retired last year, bought an RV to tour the country, and now have buyer's remorse. If they had maybe rented an RV for some extended trips before they retired, there would have been a different outcome.
Hillary comes off as blissfully naive with very very limited real world experience of travelling or living abroad. It's much different reading about other's experiences and watching UA-cam videos than actually doing it. Advice would be to not put all her (their) eggs in one basket.
James advice about test run livimg abroad is sound. I suggest to delay selling the house stateside at least a year in case they get buyers remorse of the lifestyle.
While I would worry about her long term finances I think she can do it at least for a little while. I lived in Europe and Asia and it can be significantly cheaper than you would expect. Will she live in Paris for cheap? No. Can she live live in Nice or Carcassonne for cheap? You bet. Apartment about a grand a grand a month including utilities. Transportation is silly cheap at about a euro per ride but walking is just as easy. Especially in Nice. Food is pretty cheap if you avoid lots of meats. Carre forre markets are everywhere and very affordable. Places in Asia like Thailand, Philippines and Vietnam would cut those costs in half again. My apartment in Saigon was $800 a month and nicer than a $4000 place in the States. Food was a few bucks a day to eat really well. To eat like a king it was like $40 a day. My dinner was usually a $2 meal from one of the local vendors. She will absolutely need to stay away from all Nordic countries and some euro countries like Switzerland but I think she could make a life out of it. Now being able to stay in any one location long term is going to be a challenge. They can only stay in the EU for 90 days before they have to leave for another 90 days.
Here's a concern I would raise. If they are ever planning to take Medicare upon their return back to US, then they need to pay for it every month while they stay abroad even so they don't use it, otherwise accumulated fines will be tremendous. I am surprised nobody takes it into consideration.
I lived in France 10 years in my 20s and 30s. Taxes will take a giant chunk of savings though if you move to a non EU country every couple months you will avoid resident status which triggers taxes. Learning language now is extremely important. Knowing French quite well helped me with Spanish and Italian even 30 years later. I adore Spain, but even so the thrill wears off and one yearns for the familiarity of home. It's the balance of the familiar and unfamiliar that's fun for me. I would absolutely keep a small apartment in the US in their scenario if they sell their house. Or they could put the proceeds from their house into a high yield savings account. In any case they need a backup plan so they're not stuck living overseas because they can't afford the US
Age, him and I, 60. I'm retiring next year, he does side gigs, real estate (more nuisance than its worth these days), online auctions, etc. SSI taking at 62: $4100/mo, credit debt: zero. Child: 22, homeowner, fully self-sufficient. Assets: $820k liquid, $500k real estate equity. Cars: all owned outright, I do all maintenance on them and the house. Medical: ACA until 65 plus HSA for out of pocket expenses. Traveling plans: (w/dog) he goes with us in an RV. We'll be ok.
I watched most of this, but her numbers dont make sense. How does she think she can live in France on $2K a month? And when you ask her what a AirBnB will cost she says $1,500. And even if she coul find somewhere that it does, that would only leave them $500 a month, or about $125 a week. And I have no idea whwere she gets that $1,500 a month, I would suspect for a small apartment it would be cloye to that a week. And when she says she has only been to Europe once, and could not easily go again for more than 2 weeks until retirement that sounds crazy as well. Why travel to another part fo the world, with a different culture and language base on a 2 week prior trip 10 years ago. With that said, if they both get social security, and wait until full retirement , with their current portfolio, living conservatiely they could likely make it work. But again I would suspect their costs would be way more tha $24000 a year. Maybe $24,000 AFTER all other revenue sources
They should go travel more before retiring so they can at least have an idea how they like other countries, Europe travel experience is very close to American vacation but Asia or south America is totally different , travel a few more times and decide. My wife and I travel to a few countries and while we are still working we try to travel more to Europe because it’s more expensive and while we have paycheck coming in. Then when we retire we are planning at 6 months a year we will be traveling starting in Southeast Asia. Cheaper to travel and our 401k withdrawal will be minimal than spending 6 months in Europe
Great conversation and review of their financial plan. I will say that generally, an international health insurance plan will be much less expensive than projected. $300 per month will most likely cover them both. Their plan is similar to ours, including selling the home and investing the proceeds. The earliest we would do that is at age 50, and the latest is likely age 57. It just depends on how much extra money we want each month.
Most Americans I’ve heard of traveling say $4k/month is very comfortable. What about all the air travel from travel destination to destination, and back to the US for family/friends/health needs/etc? What about housing after travel? Many people sell everything including their home and then When they want to return to the US, they are sadly now priced out of buying a home in a place that is desirable and where friends and family are located. Also, I believe anywhere from 25-50% of people who move abroad end up moving back to the states for a variety of reasons. Just some things to keep in mind. -- I would suggest not selling your house at first and taking some longer 1-6 month exploratory trips both before and after you retire. The UA-camr, Vagabond awake, has a course that teaches people how to figure out where they might want to move, or slow travel, how to plan exploratory trips, detailed budgets for living in about 20-40 different countries, etc. :)
James I enjoy your videos and really like the manner in which you break down the process. I think this is one of the better examples of how to assess if a goal is doable especially highlighting the concerns you clearly have regarding this client’s lack of exposure to long term living abroad. I hope she takes note of the strong suggestion to take the sabbatical abroad before selling everything.
Her estimated living expenses are not believable. She claims to live in an expensive area but only spends $2k a month with teenage kids. She's a dreamer with no idea of what things really cost. And all this based on one two week trip overseas? Crazy! I'm not buying any of this.
As someone who lived in Germany for 4 years, Japan for 4, and Korea for 3; I LOVE living overseas! I say DO IT!! I will say this as someone who has a pension that pays $9k+ a month and is inflation protected, they need to invest more than 6%! My wife is a Federal Employee and also has a pension, but we both max out our 401(k) and IRAs. We'll have approximately $19k a month with pensions and SS when we take all. Even with that, we want $2.5M or more so money is never an issue or concern. Will we have too much? More than likely! But we'll never concern ourselves with money and let's be real - money is the root of most stressors people deal with!
I wonder what the teenage kids think about their parents moving halfway around the world and seeing them "a couple times a year"? I don't think the majority of people could pull this off. And just wait until the grandkids start coming along.
My retirement plan is similar to theirs (in 5 years) but I've allocated $6700 a month for living and housing expenses abroad. I think their budget might be set too low. At 62, I'll have 1.8 million in liquid assets and a 50k annual pension. I'll wait to take soc sec until 70.
We are on the same boat Hillary. I think we have been watching the same UA-cam channels. My wife and I will be more than happy to share our planning with you and your husband. We have the same timeline.
James - thank you so much for these videos. Thanks to your Retirement Planning Academy I now have the RightCapital software, and have really enjoyed running the numbers. I would love to hear you talk more in-depth about avoiding Medicare IRMAA, and how charitable contributions from a pre-tax IRA can lower your RMD. The software shows the "No IRMAA" tax strategy as having a much greater impact for me than a Roth conversion, and I'd love to learn more about it. Thanks!
$2000 per month is not a reasonable number to cover all core expenses, while living abroad where expenses might be less predictable than what you're use to. Of course it's possible to live on a shoestring, but at what cost to lifestyle and fulfillment? They are clearly in a position to retire sooner, comfortably spend far more AND leave a legacy to their kids, if so inclined. People really need to stop being so conservative in this final stage of life. This is the time you've worked so hard and saved so much to get to, so don't be afraid to enjoy it. Build a plan that tells you how much you can safely spend, so it's not left to fear and emotion.
I always love people who make these huge life choices based on 1 trip that lasted 2 weeks! My brother did that! He visited Seattle 1 time for 1 week and 30 yrs later Seattle has become his dream city to live in! Mind you he hasn’t gone back to see if he still likes it! How can you make a lifestyle decision like living over season full time based on 1 two week vacation!
Careful, what you think 💯 travel is likely not what it would feel like in practice. 2 week travel is very different than living out of a suitcase full time. Good luck
A system made to keep people working till they are unable to enjoy anything. Thanks for sharing this, James and Hilarie. Sell it run and never look back. Love this.🥰
$2000 in expenses 10 years from now just seems low with no emergencies or purchasing even a used car. What happens if living in France gets old and you want to be near family because you have grandchildren? Going to rent? Live in a camper? Or buy a new house if you end up selling your current one? Lots to think about.
James, new fan and sub. How do we get to to a retirement makeover with you?? I commented on a few others CFP pages but zero response to me and seems they don't really engage comments at all. I hope your team is different. Like your style, pace and demeanor. We hope to hear from you.
Your first advisor was correct. Listen to him. You’re making a mistake based on a vacation. Do you have any idea how common that is? How often we see people blow it so hard by being so naive and lost in a dream?
This is similar to our retirement travel plans so it was great to see what you said. 1/3 year in Asia (we have lived in SE Asia in the past), 1/3 in Europe (husband is European and we have family there) and 1/3 in the US near the kids. Brave to embark upon this plan with only having been out of the US for two weeks but you have ten years to travel and study up and you seem like you have a great attitude. Good luck!
Monthly expense for 2 people is quite low, may need to allow up to double for Europe and little more for Asia However, as a side note health is EVERYTHING!!! If this is what you both want, LT travel, then DO IT as SOON as possible. You are not guaranteed tomorrow! Be surevto factor in Annual healthcare as most important cost(lower overseas) as the other expenses are easier to control. I retired 47 and left USA to live in MX and now we travel internationally once or twice a year. So glad i didnt wait.
I was in Spain and Portugal for 24 days and fell in love with Spain. I just came back from Bogota and it was beautiful and cheap also. A steak dinner for 4 with appetizers and 5 natural fruit drinks was $80 US dollars. Definitely going back to Colombia. My advice is to learn ALL the criminal and tax laws of the countries you want to stay. Also move your money to some dividend stocks that will bring income with out selling your stocks. Right now I’m getting over $6k a year on a $134k investments. The 6k is half way to cover a full live style in countries outside the us with out touching my social and pension. This week after all the gains I’m moving my 401k to a roll over ira to start investing the money on dividend stocks,
What place in France are you renting for 1300 a month? Very rural desolate areas? They don’t even have airbnbs there. Respectfully that’s dreaming. It’s a lot more likely to be 1800 + car/gas/transit is extremely more expensive.
We’re planning on doing the same thing in 3-5 years! We already know this isn’t our retirement house/area, so there are no qualms selling. We plan to travel internationally and then domestically until we find that new somewhere to settle. 😊
At 51 with $600k, you’re in a solid starting position, but it really depends on your lifestyle. How much do you plan to spend each year, and do you have other sources of income, like Social Security or pensions?
I’ve been to Europe many times and in many countries for 2 weeks at a time and I sometimes wish I could move overseas and live a life of travel and/or living in Europe (I’ve never been to Asia). You having only done it once, I would do it a few more times at various places to see if the romance of it sticks. Granted, travel is expensive and will cut into your retirement planning. Bingo, he says this at about 27 minutes. Also, there are many UA-cam channels that talk about travel and the ins and outs of living abroad, the best places to go, and the expenses of each country/city. There are also people who can help you make the move who have lived abroad and traveled most of their lives. During the next 10 years, you would also need to monitor the countries (I have also thought of France), and see if they are still viable as your 10 years are up.
I have loved going on 1 month trips for work. Moving abroad continuously, especially as nomads, makes community really hard. If you like having non-online friends, think hard about this.
This UA-camr is shilling bad information. Considering she is willing to support her kids in some way in college. This will carry over after college too. Zero inquiries about paying for or contributing to kids weddings, returning to kids weddings. Then drop a grandkid and it's game over. The grandkid will derail their pretend dream to Europe. Let alone he never brought up health and how they intend to stay active vs getting fat drinking and eating and posting to their boomer FB page.
Similar to this couple but im still in my mid 40s. We plan to retire overseas before 55, that's when all the kids would be done with college. I think too many people are conservative with their money running out. You dont need $1.5-2million for retirement savings. There are people living off social security overseas with a simple life of $1500-$2000. I think $500k by 62 should be enough w/ SS kicking in. Retire young, see the world and live life, not just saving money that you cant bring with you when you die.
Unrealistic I'm afraid. First they talk about traveling full time and then about living in France. I think they haven't traveled enough yet to make this decision. It's quite expensive to travel in Europe. Also, their children aren't launched yet, so it is unknowm what that will look like. I would suggest going on some cruises for a while! Fun and easy way to see a lot of places and less expensive.
I've lived abroad for 15 years and travels to 46 countries. $3-4k in today's dollars is my take on what she will need. I would recommend several longer trips abroad ~4/6/8 ish weeks, then reevaluate. Long term travel is a lot less glamorous in reality vs Ytube travelers. The travel bug fades eventually but definitely get out there and explore. Lastly, hit me up if you'd like to visit beautiful SLP, Mexico and run numbers.
At the rate that the world is going we either may not need to worry more than 5 years because of escalating geopolitics, AI/tech destroying economic balance, civil war, etc. On the other hand AI and robotics could make GDP skyrocket and we could live in a world of abundance in 10+ years. Think of 60, 90, 150 years ago when many labored very hard on farms or early factories to live a meager life compared to now where so many citizens in the first world work 40 hour weeks (in air conditioned offices) and have very comfortable lifestyles. I realize this doesn't apply to everyone, but as a whole abundance over time has increased due to automation and competition/growth. Tech/industry is growing faster than any of us can imagine in a much shorter periods of time. We could see growth in 10 years that dwarfs the total advancements over the past 100 years. It is always wiser to plan for harder economic times and living longer with a goal to be better prepared than 75% of the population. If you save too much, you can always adjust and live more lavishly. Conversely if the economy turns, or you're hit with lots of unexpected expenses - you can go back into the work force or find ways to cut expenses. Perhaps retiring from working for someone else means an opportunity for you to pursue a passion that can be made into a profitable hobby. It would be really sad to work so hard and never be able to enjoy your savings because your health no longer allows you to travel, move homes, etc - or because the world has gone into complete chaos and the value of money is destroyed or it is too dangerous to travel. I spend 70% of my time thinking about how I'll live my next 5 years, 10% of my time worrying about how I'll live my last 10 years, and the other 20% for the years in between. I re-evaluate yearly. It seems the hardest change going into retirement is transitioning from a mindset of saving to a mindset of spending. I also expect in a couple of years we will have tools that are better at modeling and planning retirement than what James and Roth Financial have - and they will be available to us directly - easier to use - and for very little cost.
One trip to Europe that went perfect is one thing. They should take some trips while living at home in various countries…..they might realize, cheap places to sleep aren’t always the best….
No way. 2k a month expenses? Ugh not France. Maybe the Philippines? I am not being a jerk I am being real. Also ain’t nothing wrong with the Philippines, but rather more afford with their budget
Sounds like hardly no buffer room for unexpected expenses just to try to live a fantasy in a third world place. Because living in Europe on 5hat budget is ridiculous ! And I guess their kids will have to really be successful. Because Mom and Dad are not planning to help them out or leave them anything in their lifetime 🤣
I cringed when she said her 55 yo husband has 2 weeks of vacation a year. How is that possible? Is that typical in the US? How do you even live like that?
All dream should be. Visit Asia or other continents here and there and retired in the US. Stop driving up cost for peeps on broad because you can’t afford to live in the US or Canada
France is more expensive than you think and is becoming increasingly unstable. You will also need to deeply study their tax codes to avoid any unpleasant surprises. People flee these countries because if their voraciousness.
They’ll be homeless if they decided to sell and travel, and then decide to return to the USA. It’s not a good idea generally to sell one’s home especially when the nest egg is not that much.
Putting aside the financial aspect, I guarantee will not be happy in France if you don’t speak French fluently. I strongly suggest you watch UA-cam videos of those who have made this move without understanding the pros and cons.
Is this some kind of a joke? Current spending $3000/mo with kids in college!!??? Something doesn't add up. Unless they are super savers! There's no way you can only spend $2000/mo in retirement. With this inflation we're spending 8K-10K a month not including my mortgage. We don't have kids and we're not a big spenders.
Why do you want to retire with $600k? At 51, you can work for another 16 years and make money. If you retire, you'll be spending your money till at least 59.5 and then only get 1/2 social security. Plus you need to keep the mind occupied and busy and not get bored in life. Also medical expenses are expensive so having them covered by the company is great. Plus if you travel that is more expense. Personally, I suggest working till 58-60 at lessening aggressive job roles and by 67 in low stress job and then retire. Of course, do all the vacations with family and buy things you want before then. You have to balance enjoy life with great vacations and family + savings for retirement + living.
If the house is paid off. Wait until interest go down and the price of the house will go up. If the kids want to rent, take a home equity loan of $200k and invest that money and have the kids pay for it. At the end you will still have your home which will appreciate and have your $200k investment growth to help you live abroad. With that you will have $800k instead of $600k to invest on dividend stocks. But I’m not a financial advisor nor know nothing about advising. Also start in the cheapest countries first until your SS and Pensions kick in. Don’t forget about South America because France is not that cheap compared to other countries and not as safe either.
I think they would be fine financially doing their plan in active retirement. The real test would come much later in life with potential long term care, housing or just living when they are in their later 80s or 90s. My own parents retirement changed radically once long term care came into reality. They had enough money, but they had significantly more money than this client. Perhaps Harris will win and fund $280,000 per year for in home care. I doubt if the tax payers could withstand that amount on a large scale. Do the math if you know how many boomers are reaching that age. It is an impossible amount regardless of how we feel. My own experience with in facility care is without insurance $40,000 or more per month.
Yeah, definitely sell that house and get rid of $10K in taxes! If they don't retire earlier than the current plan, they should make a Roth Conversion plan. Also, I'd want Hillary, as the high earner, to wait to 70 for social security.
They will need about $3 million minimum in today’s money. If you’re looking at 10 years from now, you have to factor in 3 to 5% inflation so 4 million by then. Until you really learn traveling, you will be paying Expat tax most anywhere you go. Where 3:20 foreigners are charged more for everything. 😅
Girlfriend.... traveled once, and now here she is...moral of the story, start traveling earlier in life and stop watching tiktok travel videos if you are prone to making rash decisions
Teenagers kids.... and parents don't give a crap about their education, housing and... just abandon them to travel???? Dammmm why the hell be the parents in the first place. Selfish folks!!!!
Travel is a great retirement goal, but the individual doesn't appear to have done much homework on the concept. If they do bail, hope the dog finds a good home!
You can retire when you wish. I was 60 years old with only 200,000 in a divorce/business settlement. I had worked hard for 40 years many times 24/7 365. I started a business but decided I was no longer interested in working that hard anymore. So I took my monthly buyout of 2,300 and retired. I moved to Thailand where I support a family of 3 on about 1500 dollars a month. Then at 65 started drawing an additional 2300 from ss. I adapted my lifestyle from 200,000 a year to a little over 28,000 a year and I’m happy. So it’s really up to you and the lifestyle you chose to live.
I am originally from Europe and I live and work 25 years in the USA. I do have dual citizenships and I am planning to retire back in the EU. I was voluntarily paying my social security and health insurance in EU past 25 years just to keep them. I moved 48 times in my life and I lived in 11 different countries for more than one year, due to my work. I traveled 78 countries. I do understand very well what challenge it is to travel or to move to different country. It is not as simple as it sounds and if something goes wrong the reality will hit very hard. The legal challenges and cultural differences might look exotic and fun, but not in the long run. There is difference huge difference between 2 weeks vacation money and retirement money. Just to fly to certain locations from USA economy class is $1,500 - 2,000. The idea to retire in foreign country is very popular and it is doable. Traveling the world while retired on $2,000 budget and flying multiple times per year to the USA is unrealistic. Some people do zero research and there is so many challenges and issues people even don't think about. For example: If someone moves full time to country, which has no Social security agreement with the USA, that person can't collect social security. Also the "free" healthcare in Europe is becoming a myth, because Europe is trying to protect their health system from healthcare tourism. In lots of countries people can't stay longer than 30 - 90 days legally as tourists. There is a big difference between dreams and delusions.
I don’t think it’s enough in Europe. If they go to Thailand or Philippines, this is feasible.
Their biggest risk to their plan is assuming their children will be 100% self sufficient 2 years after college.
I remember hitting $1.5 million at 56 and thinking, ‘This has to be enough to retire early, right?’ But then I realized there’s a lot more to it than just the amount. Having the money is one thing; knowing how to make it last is another.
James's advice about taking the retirement plan through test runs is a key point. Their experience may not replicate the travelers they follow. I know of a couple that retired last year, bought an RV to tour the country, and now have buyer's remorse. If they had maybe rented an RV for some extended trips before they retired, there would have been a different outcome.
Hillary comes off as blissfully naive with very very limited real world experience of travelling or living abroad. It's much different reading about other's experiences and watching UA-cam videos than actually doing it. Advice would be to not put all her (their) eggs in one basket.
James advice about test run livimg abroad is sound.
I suggest to delay selling the house stateside at least a year in case they get buyers remorse of the lifestyle.
While I would worry about her long term finances I think she can do it at least for a little while. I lived in Europe and Asia and it can be significantly cheaper than you would expect. Will she live in Paris for cheap? No. Can she live live in Nice or Carcassonne for cheap? You bet. Apartment about a grand a grand a month including utilities. Transportation is silly cheap at about a euro per ride but walking is just as easy. Especially in Nice. Food is pretty cheap if you avoid lots of meats. Carre forre markets are everywhere and very affordable.
Places in Asia like Thailand, Philippines and Vietnam would cut those costs in half again. My apartment in Saigon was $800 a month and nicer than a $4000 place in the States. Food was a few bucks a day to eat really well. To eat like a king it was like $40 a day. My dinner was usually a $2 meal from one of the local vendors.
She will absolutely need to stay away from all Nordic countries and some euro countries like Switzerland but I think she could make a life out of it. Now being able to stay in any one location long term is going to be a challenge. They can only stay in the EU for 90 days before they have to leave for another 90 days.
Reality will hit hard!!
Hillary, you are not living in France or Germany on that budget. Maybe Asia or S. America. Heed James' advice on dialing in the expenses for that.
Here's a concern I would raise. If they are ever planning to take Medicare upon their return back to US, then they need to pay for it every month while they stay abroad even so they don't use it, otherwise accumulated fines will be tremendous. I am surprised nobody takes it into consideration.
FYI-Replace 1 air conditioner on home=$8000. Replace roof on house=$16000
I lived in France 10 years in my 20s and 30s. Taxes will take a giant chunk of savings though if you move to a non EU country every couple months you will avoid resident status which triggers taxes. Learning language now is extremely important. Knowing French quite well helped me with Spanish and Italian even 30 years later. I adore Spain, but even so the thrill wears off and one yearns for the familiarity of home. It's the balance of the familiar and unfamiliar that's fun for me. I would absolutely keep a small apartment in the US in their scenario if they sell their house. Or they could put the proceeds from their house into a high yield savings account. In any case they need a backup plan so they're not stuck living overseas because they can't afford the US
1:53 Root financial wouldn’t talk to me with 1.5 million… their base is 2 million. Wonder how she got their services with 600k?
Age, him and I, 60. I'm retiring next year, he does side gigs, real estate (more nuisance than its worth these days), online auctions, etc. SSI taking at 62: $4100/mo, credit debt: zero. Child: 22, homeowner, fully self-sufficient. Assets: $820k liquid, $500k real estate equity. Cars: all owned outright, I do all maintenance on them and the house. Medical: ACA until 65 plus HSA for out of pocket expenses. Traveling plans: (w/dog) he goes with us in an RV. We'll be ok.
I watched most of this, but her numbers dont make sense. How does she think she can live in France on $2K a month? And when you ask her what a AirBnB will cost she says $1,500. And even if she coul find somewhere that it does, that would only leave them $500 a month, or about $125 a week. And I have no idea whwere she gets that $1,500 a month, I would suspect for a small apartment it would be cloye to that a week. And when she says she has only been to Europe once, and could not easily go again for more than 2 weeks until retirement that sounds crazy as well. Why travel to another part fo the world, with a different culture and language base on a 2 week prior trip 10 years ago.
With that said, if they both get social security, and wait until full retirement , with their current portfolio, living conservatiely they could likely make it work. But again I would suspect their costs would be way more tha $24000 a year. Maybe $24,000 AFTER all other revenue sources
600k without a pension is going to tight and travel can get really expensive.
They should go travel more before retiring so they can at least have an idea how they like other countries, Europe travel experience is very close to American vacation but Asia or south America is totally different , travel a few more times and decide.
My wife and I travel to a few countries and while we are still working we try to travel more to Europe because it’s more expensive and while we have paycheck coming in. Then when we retire we are planning at 6 months a year we will be traveling starting in Southeast Asia. Cheaper to travel and our 401k withdrawal will be minimal than spending 6 months in Europe
Love these style of videos. As a CFP it helps me consider different issues.
Great conversation and review of their financial plan. I will say that generally, an international health insurance plan will be much less expensive than projected. $300 per month will most likely cover them both. Their plan is similar to ours, including selling the home and investing the proceeds. The earliest we would do that is at age 50, and the latest is likely age 57. It just depends on how much extra money we want each month.
Most Americans I’ve heard of traveling say $4k/month is very comfortable.
What about all the air travel from travel destination to destination, and back to the US for family/friends/health needs/etc?
What about housing after travel?
Many people sell everything including their home and then When they want to return to the US, they are sadly now priced out of buying a home in a place that is desirable and where friends and family are located.
Also, I believe anywhere from 25-50% of people who move abroad end up moving back to the states for a variety of reasons.
Just some things to keep in mind.
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I would suggest not selling your house at first and taking some longer 1-6 month exploratory trips both before and after you retire.
The UA-camr, Vagabond awake, has a course that teaches people how to figure out where they might want to move, or slow travel, how to plan exploratory trips, detailed budgets for living in about 20-40 different countries, etc. :)
Really enjoy these. Keep them up.
James I enjoy your videos and really like the manner in which you break down the process. I think this is one of the better examples of how to assess if a goal is doable especially highlighting the concerns you clearly have regarding this client’s lack of exposure to long term living abroad. I hope she takes note of the strong suggestion to take the sabbatical abroad before selling everything.
Her estimated living expenses are not believable. She claims to live in an expensive area but only spends $2k a month with teenage kids. She's a dreamer with no idea of what things really cost. And all this based on one two week trip overseas? Crazy! I'm not buying any of this.
As someone who lived in Germany for 4 years, Japan for 4, and Korea for 3; I LOVE living overseas! I say DO IT!!
I will say this as someone who has a pension that pays $9k+ a month and is inflation protected, they need to invest more than 6%! My wife is a Federal Employee and also has a pension, but we both max out our 401(k) and IRAs. We'll have approximately $19k a month with pensions and SS when we take all. Even with that, we want $2.5M or more so money is never an issue or concern. Will we have too much? More than likely! But we'll never concern ourselves with money and let's be real - money is the root of most stressors people deal with!
That’s my dream too! Good luck to this couple.
Wow, that was great! Definitely makes me want to sign up for the program, get my number dialed in and then have stress test session with you guys.
I wonder what the teenage kids think about their parents moving halfway around the world and seeing them "a couple times a year"? I don't think the majority of people could pull this off. And just wait until the grandkids start coming along.
My retirement plan is similar to theirs (in 5 years) but I've allocated $6700 a month for living and housing expenses abroad. I think their budget might be set too low. At 62, I'll have 1.8 million in liquid assets and a 50k annual pension. I'll wait to take soc sec until 70.
We are on the same boat Hillary. I think we have been watching the same UA-cam channels. My wife and I will be more than happy to share our planning with you and your husband. We have the same timeline.
Strange. You go to Europe once and want to sell the house and move to Asia.
This is a very drastic swing.
Pack up and go.
James - thank you so much for these videos. Thanks to your Retirement Planning Academy I now have the RightCapital software, and have really enjoyed running the numbers. I would love to hear you talk more in-depth about avoiding Medicare IRMAA, and how charitable contributions from a pre-tax IRA can lower your RMD. The software shows the "No IRMAA" tax strategy as having a much greater impact for me than a Roth conversion, and I'd love to learn more about it. Thanks!
Can I retire ?
Yes
Should I retire?
Probably no
$2000 per month is not a reasonable number to cover all core expenses, while living abroad where expenses might be less predictable than what you're use to. Of course it's possible to live on a shoestring, but at what cost to lifestyle and fulfillment? They are clearly in a position to retire sooner, comfortably spend far more AND leave a legacy to their kids, if so inclined. People really need to stop being so conservative in this final stage of life. This is the time you've worked so hard and saved so much to get to, so don't be afraid to enjoy it. Build a plan that tells you how much you can safely spend, so it's not left to fear and emotion.
Allow for an exchange rate risk throughout the overseas living?
I always love people who make these huge life choices based on 1 trip that lasted 2 weeks! My brother did that! He visited Seattle 1 time for 1 week and 30 yrs later Seattle has become his dream city to live in! Mind you he hasn’t gone back to see if he still likes it! How can you make a lifestyle decision like living over season full time based on 1 two week vacation!
Careful, what you think 💯 travel is likely not what it would feel like in practice. 2 week travel is very different than living out of a suitcase full time. Good luck
Slow travel! That’s my goal! 😊
The short answer is no, and the long answer is also no.
Hi James.. Can i get a consultation with you? Thank you.
I would never want to be away from my children,adult or otherwise for that long.
I would miss them and our grandchildren way too much
Great advice, as always. And, hats off to Hillary, for looking far into the future, setting a goal, and making a plan to do it.
Is Root something that individuals can use? Or is it for the CFP field? I have been looking for this as a 58yo. Thank you.
She is talking about retire in Thailand
Those were the costs living abroad 20 years ago.
A system made to keep people working till they are unable to enjoy anything. Thanks for sharing this, James and Hilarie. Sell it run and never look back. Love this.🥰
$2000 in expenses 10 years from now just seems low with no emergencies or purchasing even a used car. What happens if living in France gets old and you want to be near family because you have grandchildren? Going to rent? Live in a camper? Or buy a new house if you end up selling your current one? Lots to think about.
James, new fan and sub. How do we get to to a retirement makeover with you?? I commented on a few others CFP pages but zero response to me and seems they don't really engage comments at all. I hope your team is different. Like your style, pace and demeanor. We hope to hear from you.
Your first advisor was correct. Listen to him. You’re making a mistake based on a vacation. Do you have any idea how common that is? How often we see people blow it so hard by being so naive and lost in a dream?
Americans must see the world at 20s. The world has so much to see and learn especially in Asia.
Yikes that property tax is brutal
This is similar to our retirement travel plans so it was great to see what you said. 1/3 year in Asia (we have lived in SE Asia in the past), 1/3 in Europe (husband is European and we have family there) and 1/3 in the US near the kids. Brave to embark upon this plan with only having been out of the US for two weeks but you have ten years to travel and study up and you seem like you have a great attitude. Good luck!
Monthly expense for 2 people is quite low, may need to allow up to double for Europe and little more for Asia
However, as a side note health is EVERYTHING!!! If this is what you both want, LT travel, then DO IT as SOON as possible. You are not guaranteed tomorrow! Be surevto factor in Annual healthcare as most important cost(lower overseas) as the other expenses are easier to control. I retired 47 and left USA to live in MX and now we travel internationally once or twice a year. So glad i didnt wait.
I was in Spain and Portugal for 24 days and fell in love with Spain. I just came back from Bogota and it was beautiful and cheap also. A steak dinner for 4 with appetizers and 5 natural fruit drinks was $80 US dollars. Definitely going back to Colombia. My advice is to learn ALL the criminal and tax laws of the countries you want to stay. Also move your money to some dividend stocks that will bring income with out selling your stocks. Right now I’m getting over $6k a year on a $134k investments. The 6k is half way to cover a full live style in countries outside the us with out touching my social and pension. This week after all the gains I’m moving my 401k to a roll over ira to start investing the money on dividend stocks,
What place in France are you renting for 1300 a month? Very rural desolate areas? They don’t even have airbnbs there. Respectfully that’s dreaming. It’s a lot more likely to be 1800 + car/gas/transit is extremely more expensive.
Love your make over videos 👍
We’re planning on doing the same thing in 3-5 years! We already know this isn’t our retirement house/area, so there are no qualms selling. We plan to travel internationally and then domestically until we find that new somewhere to settle. 😊
At 51 with $600k, you’re in a solid starting position, but it really depends on your lifestyle. How much do you plan to spend each year, and do you have other sources of income, like Social Security or pensions?
I’ve been to Europe many times and in many countries for 2 weeks at a time and I sometimes wish I could move overseas and live a life of travel and/or living in Europe (I’ve never been to Asia). You having only done it once, I would do it a few more times at various places to see if the romance of it sticks. Granted, travel is expensive and will cut into your retirement planning. Bingo, he says this at about 27 minutes.
Also, there are many UA-cam channels that talk about travel and the ins and outs of living abroad, the best places to go, and the expenses of each country/city. There are also people who can help you make the move who have lived abroad and traveled most of their lives.
During the next 10 years, you would also need to monitor the countries (I have also thought of France), and see if they are still viable as your 10 years are up.
Housing prices will start to fall as Boomers (of which I am one) start to die off. In about 10 years you'll start to see this effect.
I have loved going on 1 month trips for work. Moving abroad continuously, especially as nomads, makes community really hard. If you like having non-online friends, think hard about this.
Glad to hear your children will be more adults by the time you start traveling & being gone for months at a time to travel the world.
This UA-camr is shilling bad information. Considering she is willing to support her kids in some way in college. This will carry over after college too. Zero inquiries about paying for or contributing to kids weddings, returning to kids weddings. Then drop a grandkid and it's game over. The grandkid will derail their pretend dream to Europe. Let alone he never brought up health and how they intend to stay active vs getting fat drinking and eating and posting to their boomer FB page.
Similar to this couple but im still in my mid 40s. We plan to retire overseas before 55, that's when all the kids would be done with college. I think too many people are conservative with their money running out. You dont need $1.5-2million for retirement savings. There are people living off social security overseas with a simple life of $1500-$2000. I think $500k by 62 should be enough w/ SS kicking in. Retire young, see the world and live life, not just saving money that you cant bring with you when you die.
Why don’t they consider bringing their dependent children along when they retire?
Unrealistic I'm afraid. First they talk about traveling full time and then about living in France. I think they haven't traveled enough yet to make this decision. It's quite expensive to travel in Europe. Also, their children aren't launched yet, so it is unknowm what that will look like. I would suggest going on some cruises for a while! Fun and easy way to see a lot of places and less expensive.
I've lived abroad for 15 years and travels to 46 countries. $3-4k in today's dollars is my take on what she will need. I would recommend several longer trips abroad ~4/6/8 ish weeks, then reevaluate. Long term travel is a lot less glamorous in reality vs Ytube travelers. The travel bug fades eventually but definitely get out there and explore. Lastly, hit me up if you'd like to visit beautiful SLP, Mexico and run numbers.
At the rate that the world is going we either may not need to worry more than 5 years because of escalating geopolitics, AI/tech destroying economic balance, civil war, etc. On the other hand AI and robotics could make GDP skyrocket and we could live in a world of abundance in 10+ years. Think of 60, 90, 150 years ago when many labored very hard on farms or early factories to live a meager life compared to now where so many citizens in the first world work 40 hour weeks (in air conditioned offices) and have very comfortable lifestyles. I realize this doesn't apply to everyone, but as a whole abundance over time has increased due to automation and competition/growth. Tech/industry is growing faster than any of us can imagine in a much shorter periods of time. We could see growth in 10 years that dwarfs the total advancements over the past 100 years.
It is always wiser to plan for harder economic times and living longer with a goal to be better prepared than 75% of the population. If you save too much, you can always adjust and live more lavishly. Conversely if the economy turns, or you're hit with lots of unexpected expenses - you can go back into the work force or find ways to cut expenses. Perhaps retiring from working for someone else means an opportunity for you to pursue a passion that can be made into a profitable hobby.
It would be really sad to work so hard and never be able to enjoy your savings because your health no longer allows you to travel, move homes, etc - or because the world has gone into complete chaos and the value of money is destroyed or it is too dangerous to travel.
I spend 70% of my time thinking about how I'll live my next 5 years, 10% of my time worrying about how I'll live my last 10 years, and the other 20% for the years in between. I re-evaluate yearly. It seems the hardest change going into retirement is transitioning from a mindset of saving to a mindset of spending. I also expect in a couple of years we will have tools that are better at modeling and planning retirement than what James and Roth Financial have - and they will be available to us directly - easier to use - and for very little cost.
One trip to Europe that went perfect is one thing. They should take some trips while living at home in various countries…..they might realize, cheap places to sleep aren’t always the best….
No way. 2k a month expenses? Ugh not France. Maybe the Philippines? I am not being a jerk I am being real. Also ain’t nothing wrong with the Philippines, but rather more afford with their budget
It all sounds euphoric…..still, it’s home sweet home.
Based on the calculation shown, looks like they would only retire at around 66 yo.
Sounds like hardly no buffer room for unexpected expenses just to try to live a fantasy in a third world place. Because living in Europe on 5hat budget is ridiculous !
And I guess their kids will have to really be successful. Because Mom and Dad are not planning to help them out or leave them anything in their lifetime 🤣
I cringed when she said her 55 yo husband has 2 weeks of vacation a year. How is that possible? Is that typical in the US? How do you even live like that?
All dream should be. Visit Asia or other continents here and there and retired in the US.
Stop driving up cost for peeps on broad because you can’t afford to live in the US or Canada
did i miss roots $20,000 a year fee?
Travel is much more expansive than she thinks, her budget is so bare bone
France is more expensive than you think and is becoming increasingly unstable. You will also need to deeply study their tax codes to avoid any unpleasant surprises. People flee these countries because if their voraciousness.
They’ll be homeless if they decided to sell and travel, and then decide to return to the USA. It’s not a good idea generally to sell one’s home especially when the nest egg is not that much.
51 with only $600k, retire?.?? No way Jose. Unless you want to be broke by 60 and dead by 61
Putting aside the financial aspect, I guarantee will not be happy in France if you don’t speak French fluently.
I strongly suggest you watch UA-cam videos of those who have made this move without understanding the pros and cons.
Is this some kind of a joke? Current spending $3000/mo with kids in college!!??? Something doesn't add up. Unless they are super savers! There's no way you can only spend $2000/mo in retirement. With this inflation we're spending 8K-10K a month not including my mortgage. We don't have kids and we're not a big spenders.
Do it sooner than later, you won’t regret it.😎
Look for a job that allows you to work overseas, the government has plenty of job available.
Mid life crisis
Why do you want to retire with $600k? At 51, you can work for another 16 years and make money. If you retire, you'll be spending your money till at least 59.5 and then only get 1/2 social security. Plus you need to keep the mind occupied and busy and not get bored in life. Also medical expenses are expensive so having them covered by the company is great. Plus if you travel that is more expense. Personally, I suggest working till 58-60 at lessening aggressive job roles and by 67 in low stress job and then retire. Of course, do all the vacations with family and buy things you want before then. You have to balance enjoy life with great vacations and family + savings for retirement + living.
$600,000 is nothing in today’s dollars.
With only $500k, you cannot retire now.
If the house is paid off. Wait until interest go down and the price of the house will go up. If the kids want to rent, take a home equity loan of $200k and invest that money and have the kids pay for it. At the end you will still have your home which will appreciate and have your $200k investment growth to help you live abroad. With that you will have $800k instead of $600k to invest on dividend stocks. But I’m not a financial advisor nor know nothing about advising. Also start in the cheapest countries first until your SS and Pensions kick in. Don’t forget about South America because France is not that cheap compared to other countries and not as safe either.
Retiring with a million and ending with $4-6 million at death?
Thumbnail is kind of creepy is it a Halloween thing?
I think they would be fine financially doing their plan in active retirement. The real test would come much later in life with potential long term care, housing or just living when they are in their later 80s or 90s. My own parents retirement changed radically once long term care came into reality. They had enough money, but they had significantly more money than this client. Perhaps Harris will win and fund $280,000 per year for in home care. I doubt if the tax payers could withstand that amount on a large scale. Do the math if you know how many boomers are reaching that age. It is an impossible amount regardless of how we feel. My own experience with in facility care is without insurance $40,000 or more per month.
Yeah, definitely sell that house and get rid of $10K in taxes! If they don't retire earlier than the current plan, they should make a Roth Conversion plan. Also, I'd want Hillary, as the high earner, to wait to 70 for social security.
They will need about $3 million minimum in today’s money. If you’re looking at 10 years from now, you have to factor in 3 to 5% inflation so 4 million by then. Until you really learn traveling, you will be paying Expat tax most anywhere you go. Where 3:20 foreigners are charged more for everything. 😅
Girlfriend.... traveled once, and now here she is...moral of the story, start traveling earlier in life and stop watching tiktok travel videos if you are prone to making rash decisions
Woman: "$600K, when can I retire?"
Me: "For $10K, I will tell you that it depends on your income, expenditures, and retirement goals"
Never. Next……
Teenagers kids.... and parents don't give a crap about their education, housing and... just abandon them to travel???? Dammmm why the hell be the parents in the first place. Selfish folks!!!!
Travel is a great retirement goal, but the individual doesn't appear to have done much homework on the concept.
If they do bail, hope the dog finds a good home!