The question that quickly follows “Why, did you move to Costa Rica” is “How, did you move to Costa Rica” with the implied “at such a young age, and retired”. That is quite the loaded question. I know if I had asked that question of an expat during our research, I would want part of the response to entail financial information – how much money did they have, how did they invest it etc…I may disappoint some, but I am not going to share with you my financials. So, how did we retire early? To answer that question I am going to detail below a few things that allowed us to retire in our early 40’s.
After several years of marriage and a few years of trying to have a child, Jen and I decided kids were not for us and we made the conscious decision not to make one, or two or four. We have been married for 18 years now and have never had the expense of diapers, school lunches, karate lessons or tuition or any of the other kid related expenses that wreck havoc on finances. Instead, we built careers and always had a 2-income household.
Lived Below our Means
During our working years, we lived well but well below our means. While I always had an eye for fast and expensive cars we did not buy them. We owned, middle of the road, dependable vehicles. Our last 2 cars, at the pinnacle of our careers were a 2008 Honda Accord EX-L and a 2009 Mini Cooper S. Each cost us less than $25,00 and both of which we owned outright and sold before we came to Costa Rica.
The first 5 years of our marriage was saddled with debt; thanks to my awful spending habits when I was single. We were able to pay all debt off within those 5 years and other than a mortgage and loans for the vehicles, we operated on cash. If we needed something, we saved up for it and bought it. Being debt free allowed us the flexibility to choose to leave that lifestyle if we chose to.
Willing to Change our Lifestyle
We chose to retire early; in order to do this we had to change our lifestyle and move to a less expensive part of the world. To be clear, Costa Rica is not necessarily cheaper than the United States. If you want the same conveniences here as in the US, and the same food, and the same entertainment then you will spend as much, if not more, if you were to move here.
We chose to trade going to dinner 3 or 4 times a week to shopping at the local farmers market and cooking our own meals. We chose, instead of a 2700 square foot home for 2, to live in 600 square feet…but with a killer view. We chose to learn the bus system here as opposed to owning 2 vehicles and the list goes on. All in all, we were willing to move to another country in order to retire early.
Willing to Move Outside the US to Make it Happen
Couldn’t you just reduce your lifestyle in the States? That is a great question. One main drawback to retiring early in the US is the ever-looming cost of medical insurance that, if not offset by an employer, is truly very expensive. To cover Jen and I would have cost over $800 – or put another way – insurance in the States would cost the equivalent of; our rent + transportation and half of the month’s worth of groceries in Costa Rica. Here we will have socialized insurance or Caja and that will cost us about $275 a month for both of us. We will not have access to this until we establish residency – in about a year – I hope. Also, it is actually affordable to pay for medical services out of pocket – think teeth cleaning for $30. In addition, there are supplemental insurance programs, which we are looking at in the interim, that are significantly cheaper than the US.
Another reason for not retiring in the US was the standard of life that we were used to. I really think we needed to shock our system and deprogram ourselves a bit from the culture of the United States. We wanted to be done with the so-called American Dream of acquiring more stuff and working yourself to death to get it. Our idea was to live more simply… live smaller but enjoy our lives more and we thought moving to a country that already had that type of culture was the way to achieve our goal.
But, But, But
At this point you may be saying but that doesn’t look like my life. I don’t have the same options as you. How am I going to do what you did? The simple answer is – I have no idea. The reality is – everyone has buts and they can go on and on; but I have a kid, but I bought a Mercedes and my finances are crap… but, but, but. I could have said, but my family is here, but I have worked so hard to get to where I am at, but I will miss this, that and the other. It comes down, in my opinion to the question – do you really want a change? That answer, sad to say, is typically, no.
People, including me, want to complain about their lot in life but are very resistant to do anything about it. So, what is one to do – how can someone do what we did if they are in a different situation? I really can’t say, but…
The more I think about our recent move, the more I think on how I could have done this earlier….I know, I know – Loco American living the dream but still not satisfied. That is what I do though, think about things. So here are a couple of ideas that I have seen available here that could help someone do this faster.
Own your own Business – Start or buy one here or create a Location Independent business on the Internet. A business is never a sure thing; however, it would be a change. I particularly like Internet types of business that allow flexibility in location…as long as you have a WIFI connection you can work.
House Sit – Long term gigs could help to offset expenses – typically you pay utility costs and take care of the house and pets and you live rent free. Short term gigs you can earn a small amount of money per day for watching a home or pets.
Volunteer Programs – Many programs offer a place to lay your head and/or meals in return for physical labor or help with a business. There are many eco farms, hotels and nature programs here willing to exchange food or housing for labor.
I am sure there are other ways to accomplish your dreams. As is the answer so many times….Google It!