I haven’t written a post like this in a long time. It’s been something like two years now. Time flies, which is just one reason why financial independence is so important.
For years, I revealed the details of my real-life spending every single month. I showed exactly what I earned and spent, keeping myself honest and inspiring others to save/invest more in the process. It was a wonderful way to motivate both myself and others toward financial independence. And I wouldn’t have done any of it differently.
However, after years of posting the monthly budgets, I became a little weary.
I began to feel like talking about what I was spending on electricity or groceries was kind of a wasted opportunity, where I could have instead used the resources involved (time, creative energy, etc.) to discuss something far more insightful.
In addition, it became apparent to me over time that there were some people who were only interested in what I was making and spending. This misses 99% of what I write about.
In my view, the budgeting is the easy part. Once you have it figured out, it’s just a matter of cruising along until you hit your financial goals.
The bigger challenges in life require the constant striving toward one’s potential as a human being.
As such, I’ve found it more engaging to write about things like compelling dividend growth stock ideas, dividend growth investing as a long-term investment strategy, becoming a better/happier person, and living a more fulfilled life.
So I now split most of my creative time between writing about investing and writing about the benefits and mechanics of a holistic lifestyle that’s underpinned by financial independence and designed to maximize one’s happiness and quality of life.
That said, relocating to Chiang Mai, Thailand as a dividend expat has rejuvenated my enthusiasm about sharing my real-life expenses, mostly because I find it appealing to share what this new and different cost structure looks like in real life.
And so I’m going to reveal what I spent (rounded to the nearest dollar after using current exchange rates) in October 2017 (my first full month in Chiang Mai). Philanthropic giving and business expenses are excluded.
Without further ado:
|Rent & Utilities||$464|
The Everything Else category includes expenses that don’t have a budget. I had to buy a new phone charger after my charger broke one night. I also left an umbrella in an Uber one evening, which required me to go buy a new one. Lastly, I had to also buy a new pair of gym shoes, as my old shoes were old and worn out.
The total amount of money I spent in October 2017 slightly exceeded my passive income of ~$1,200/month (I don’t count blogging/writing/coaching income as passive, unlike a lot of people), but this was by design. Said another way, it was on purpose. I didn’t hold my spending back in any way whatsoever.
I was actually curious what I’d spend if I were totally unchained from budgeting/limitations.
Well, I have my answer.
There was perhaps a bit of a coiled-up spring inside of me. After living so frugally and watching expenses so closely in the US, for so many years, I felt like letting loose once I got here. Of course, my idea of “letting loose” is probably quite a bit different from what other people would think of that term. It’s all relative.
Plus, I wore many hats during the month of October.
I was a social entrepreneur, meeting like-minded people left and right. This involved a few more coffee shop visits than I’d probably otherwise partake in. But I really enjoyed it all. It’s been truly fantastic. I’m far more social here than I ever was in the States. This is largely because I no longer feel like a stranger in a strange land. I’m still an introvert (it’s not like I’m whooping it up late night at clubs), but I’m able to have these meaningful conversations with small groups that totally fills me with inspiration.
I was an urban bachelor, living in a gorgeous (but small) and fully-furnished apartment that’s located in one of the hippest and most walkable parts of the city. I’m dating someone and paying for everything. We’re taking Uber almost everywhere. We’re going to the movies. We’re eating out of the house for every single meal. We’re doing whatever we want, really.
I was a tourist, living in a totally new and foreign city for the first time in my life. As such, there’s a natural learning curve. I don’t know where the best places are for everything. I sometimes spent too much. I sometimes made mistakes. I also visited some of the city’s finest attractions, climbing mountains, petting tigers, and walking around ancient temples in the process. Actually, I was a tourist times two, as I was visiting all of these places with the girl I’m dating – and I was paying for her, too.
Truth be told, I was practically spending for two people for much of October, since I would have for sure spent considerably less money if I were just paying for me. Multiple dinners and events involved me paying for both of us.
Yet I still spent very little overall money.
I have no doubt in my mind that this exact same lifestyle would cost at least three times more in a comparable city in the States.
And that’s not even factoring in the savings on health insurance and income taxes. Both would be significant (if I were still living in the US) due to my business income. However, both have been almost totally eliminated.
The value here is incredible. And I can say that the move has exceeded my expectations thus far.
One of the reasons I moved over here was for the building of relationships, which I’ve openly discussed. I could just stay in a cheap apartment (or get a roommate), never date, pass up the opportunity to meet people, not explore the city and surrounding area, and spend less than $500 per month here. That wouldn’t be a problem. But that’s not why I came. Nor is that how I want to live.
All of the saving and investing is a means to an end. I did all of this to be free to live life as I see fit.
For anyone following me on Twitter and checking my updates, you’ll see by the pictures I’m sharing that I’m living a very rich and active life over here.
That said, I feel good knowing I have an ace in the hole. There’s a lot of wiggle room in my budget. If some kind of catastrophic event were to occur and cause my income to materially drop, it would not be that difficult for me to scale back.
Looking at things another way, spending $1,100 to $1,200 per month represents kind of a bottom for me in the US. That’s “scraping the barrel”, more or less. But spending $1,100 to $1,200 per month represents kind of a top for me here in Chiang Mai. That’s essentially me going about life without worrying about money or spending at all. And so I could scale that back quite a bit, if I had to. But I don’t anticipate such a need arising.
In conclusion, I would have had to be a bit more cautious with the spending if passive income were all I had to live off of. Simply cutting out the tourist stuff would have dropped me below $1,200, but I fortunately don’t have to confine or limit myself like that. My active income complements my passive income (and vice versa). So if I want to, say, travel to a different part of the country (or a different country altogether), I can do that (regardless of the cost).
Being financially free means one is free of financial concerns. And that’s where I’m at. Knowing that I’ve got my core personal expenses (rent, food, transportation, phone, etc.) covered via passive income totally frees me to live life completely on my terms.
It just so happens that living life completely on my terms costs very little because of who I am, what I value in life, and where I’m now living.
I wanted to share these real-life expenses with you readers in order to show what geographical arbitrage looks like for me in real-time. While my lifestyle/spending doesn’t necessarily correlate all that well to anyone else’s lifestyle/spending (which is partly why I stopped sharing the spending updates), I still think there’s value to be gleaned from the peek at what living life fairly full-out (by my definition) looks like in a place with such a dramatically lower cost structure than the United States.
How about you? What was your spending like for October? Did you enjoy seeing my expenses for Chiang Mai?
Thanks for reading.
Image courtesy of: Stuart Miles at FreeDigitalPhotos.net.
P.S. If you’re at all interested in becoming a dividend expat, or even just becoming financially independent, there are a number of resources that are invaluable toward that end. Definitely check them out!