As the true nature of our travel plans — that we’re leaving the Bay Area to travel indefinitely — dawned on friends, family and colleagues, we’ve noticed the appearance of a rather large elephant in the corner. In general, folks have been intrigued, supportive and at times wistful about our plans, but the elephant has remained, wearing a little sign that reads, “How can you afford this?” One of our more outspoken friends even asked, “Are you secret millionaires or something?”
Ok, we get it. A lot of people don’t understand how we can take the time off from work or afford the expenses associated with long-term travel. So we’ve decided to share, in general terms, how we are doing it. We’ll start with an overview of where our seed funding came from and then, as we travel, we’ll update you on how we’re doing. And no, being a millionaire isn’t required. Nor is winning the lottery. So, what is?
- Saving. We know it isn’t sexy, but we’ve saved 10 percent of our pre-tax income for the last 10 years. We’re not going to provide actual dollar figures here because we figure you’ll be appalled one way or the other: Either you’ll think we have way too little or you’ll think you could never save an equivalent amount. Instead, try the math for yourself and figure out how much you could collect from doing the same thing. Saving consistently may sound challenging, but here’s the key: Brian transfers the money out of our checking accounts immediately and puts it into a savings account. He even does this with holiday bonuses and unexpected income before spending one penny. When money isn’t readily accessible, you can’t spend it.
- Planning. Boring, we know, but hang in there. We have estimated the cost of living in our top travel destinations by doing some basic research. It’s considerably less than living in Silicon Valley, we can tell you. We’ll share more specifics from the road… We’ve also reviewed our savings accounts to determine how much we can reasonably spend and what we’ll want to preserve for the future. Here’s the breakdown: We are allocating 40 percent of our total savings to the trip, which we’ve estimated will cover 2-3 years of travel depending on our destinations and lifestyle. Another 40 percent is in retirement savings and is off the table for another 30 years or so (invested accordingly). The last 20 percent is in an emergency fund that will either help us out of a major bind or provide a buffer while we’re re-settling long term. Pretty simple, huh?
- Believing. The first two “secrets” were pretty straightforward and task driven. This last one is a mindset. In order to do something like this, you have to believe it’s possible. We all set limits for ourselves. When I was a kid, I loved to dance. I studied it seriously for 15 years and part of me wanted to go pro, but I never believed it was possible. I don’t recall anyone telling me it was impossible; in fact, one of my ballet teachers contradicted me when I said I was too tall and didn’t have the right body type. She had danced in a company and could be considered an authority on the subject. Yet, I still didn’t believe enough to try. Who knows what might have happened if I had? There are examples of this in all of our lives. For many years, the four-minute mile was considered a physical impossibility for mankind, but on May 6, 1954, Roger Bannister broke it. And 56 days later, someone else did. See what can happen with belief? What limitations are you living by?
Please feel free to drop us a line with questions or comments. We would be happy to encourage you on your own journey, whatever that entails.