Living as a young retiree in Thailand is pretty awesome.
It’s basically a dream come true for me.
I live in an exotic country, surrounded by a culture that is more in line with my personal value system.
Warm weather, great food, kind people. It’s not too shabby.
And I can do this without worrying about a job or money. All while I’m still in my 30s.
That’s because the five-figure dividend income my FIRE Fund generates on my behalf covers my essential expenses.
I wake up and get paid. It really couldn’t be any easier.
World-class businesses all around the world are doing what they do best – making money. And they send shareholders, like me, a portion of that profit. That portion comes in the form of cash dividend payments. As profits grow, so do those dividend payments.
Living off of dividends is straightforward enough.
But does living in a foreign county complicate matters?
I’ve received a few emails inquiring as to how I go about managing my money now that I no longer live in the US. Some of you readers are curious about how I approach my finances here in Chiang Mai, Thailand.
Well, it’s mostly the same as it was when I still lived in the States.
But I want to take some time today to answer those questions with a bit more depth. This piece will allow me to refer back to it when anyone asks about how it works.
I’m going to cover this topic across three broader aspects of money management.
First, one has to keep track of their spending. As I note in all monthly expense reports, tracking every penny (or baht) of spending after achieving FIRE is just as important as it is while still marching toward FIRE.
Managing your budget is crucial to achieving FIRE. But it’s just as crucial to staying FIRE. You can’t change the habits that got you there.
Well, the budgeting of my money (tracking my income and expenses) while living abroad hasn’t changed much. It’s very similar to what I was doing when I was living in the US.
There are only two key differences.
One, I no longer put any “effort” into keeping expenses low. I live in one of the most cost-effective, value-oriented cities in the world. It was honestly a challenge to keep my spending low in the US, even though I’m naturally pretty frugal. It’s much easier now. I don’t even think about it, really.
Two, I have to spend more time manually inputting expenses into my budget spreadsheet. That’s because credit cards aren’t as commonly accepted over here, which means I’m paying in cash more often. So I’ll remember what I spend on stuff like lunch, coffee, and dinner, then I’ll input that data when I get back to my computer.
As noted above, I pay for most expenses in cash now. I don’t whip out the credit card for everything. It’s a bit different compared to the ubiquity of using credit cards in the States.
This isn’t a big deal at all, though.
However, I do need to make sure I always have ready access to cash.
That requires regular visits to the ATMs here, which are plentiful. There’s practically an ATM on every block.
Before I moved abroad, I made sure to open a High Yield Investor Checking Account with Charles Schwab, which is attached to my brokerage account.
This is a no-brainer. I already noted that this is one of the necessary financial products one must have before they decide to move abroad.
That’s because Schwab will refund your worldwide ATM fees back to you, and there are no foreign transaction fees.
This is a significant benefit. Most ATMs here in Chiang Mai charge 220 baht (almost $7) to withdraw money. Getting those refunds back at the end of every month has been huge for me. This is many hundreds of dollars per year we’re talking about.
So I simply go to an ATM when I need cash, make a withdrawal, and then spend as necessary.
Making sure there is cash in my Schwab checking account is also simple. Since I also use Schwab’s brokerage service, I can instantly move cash from the brokerage account (i.e., dividends) right over to the checking account, which then allows me to withdraw that cash right away. It’s amazing. It’s totally fluid.
When I do have the ability to use a credit card, I use my Capital One Quicksilver card. It offers 1.5% cash back rewards. And there are no foreign transaction fees. Just make sure to always choose to pay in local currency. Converting a foreign currency to USD at the POS usually involves fees.
I will note here, it’s a good idea to have backup debit and credit cards. Just in case you lose your primary card. The debit card, in particular, is your lifeline while living abroad.
Managing The Portfolio
Like I noted at the outset of the article, my overall approach to managing my money hasn’t changed much since moving abroad.
The one area that hasn’t changed at all is in the way I go about managing my portfolio.
I don’t invest any differently, which translates to not suddenly being under the impression that I need to buy Thai stocks.
I can still access my portfolio during open hours for the various US stock exchanges, which allows me to occasionally buy high-quality dividend growth stocks. It’s just that I’m logging in at, say, midnight instead of noon (I’m currently 12 hours ahead of US EST).
There’s really no difference at all.
I don’t find myself logging into anything any more or less than I used to, nor do I feel different as an investor over here.
One neat thing, though, is that there is just less financial “noise” in Chiang Mai. The US is so heavily focused on money. There is information that bombards you and forces its way into your life. Noise figures out how to weasel its way into your brain. I find a lot less of this incidental noise in my life now. That’s really nice.
Personal Capital was mentioned earlier for its budgeting capabilities, but I think the platform is even better in terms of visualizing your portfolio.
Using these sites doesn’t work any differently when living abroad, but you might need a VPN service if your foreign IP address is blocked. I use TunnelBear for my VPN service. This allows me to access sites as if I were still in the US.
I wasn’t actually planning on writing an article like this. Managing my money while living abroad is so straightforward, I thought it’d be boring to write about it.
However, I’ve received numerous emails over the last year or so asking about how I go about managing the portfolio, investing capital, and getting cash. I hope this piece demystifies all of that.
Living abroad has never been easier than it is now. The Internet makes it so that, in pure financial terms, I don’t even feel like I’m living in a foreign country. Other than using cash more than I used to, much of how I go about managing my finances is the same as it ever was.
What do you think? Do you live abroad? Travel often? Do you find it to be difficult or different to manage your money when not in your home country?
Thanks for reading.
Image courtesy of: Sira Anamwong at FreeDigitalPhotos.net.
P.S. If you’re interested in becoming FIRE, and/or moving abroad and taking advantage of geographic arbitrage, make sure to check out some fantastic resources I’ve personally used on my way to becoming financially free at 33!