Geo-Arbitrage Your Housing

Geo-arbitrage Your Housing

Note: This is the first in a series of Housing alternative articles.  They are intended to get you thinking “outside the box.” Not every alternative will work for everybody.

Geo-arbitrage is a big word you may have heard thrown around in various ways over the last few years.  It basically means do things where they are cheaper (my definition.)  Where I have heard it most is when US companies send jobs overseas where workers are cheaper.  Retirement may be your time use this idea to your advantage.

Is Moving to a Less Expensive Area an Option?

The same 3 bedroom townhouse that is 1.5 Million in New York City might be $100,000 somewhere in the Midwest, or even less.  For most of us our jobs have dictated where we live, and those jobs were usually near big cities that tended to be expensive.  Since in retirement you might not be tethered to a job you are no longer living under that constraint.  You might be able to keep that same standard of housing for one quarter the cost by making a move.

The Internet Helps!

There is one more big change that helps make housing Geo-arbitrage possible.  That is the growth of the high speed Internet.  The internet opens up countless income opportunities and makes communication with friends and associates around the country or around the world easy.

What is Important To You?

Try making a list of what is important in where you live.  Do you need public transportation?  Is shopping at a mall important or do you usually use Amazon anyway?  Is it important to be near family and friends?  If so do you have to be 10 minutes away or are weekly or monthly visits OK?  Next rank your list items in order of importance.  Are some deal breakers and others just “nice to haves?”  Consider what new activities you might like to do but your current location makes difficult.  For example maybe you live in a city but want to take hikes in the mountains.  Start investigating possibilities and see how they match up to your desired budget.

Maybe a Nearby Move?

Taking advantage of less expensive housing at a different location doesn’t have to mean moving across the country.  This is especially important for people with family connections that don’t want to move too far away.  In many areas real estate costs are still determined by how close you are to major cities.  This is a left over from the pre-internet world where everyone had to commute into a factory or office.  Often a move a half hour away can make all the difference.

Keep An Open Mind

There is a lot more to living somewhere than just cost.  You have to like the area and at least some of the people!  Does the area have the kinds of activities you care about available?  Keep an open mind here too.  Maybe there are even cooler things in the new location if you bother to explore.  One obvious option is can you rent for six months or a year and see if you like it?

If moving in a less expensive area is not possible all the time can you do it some of the time.  Maybe you live in an area that is popular in the summer months.  Could you rent out your house during the summer while you travel or live in a less expensive area?  Could you share a space part of the year in an expensive area and spend the bulk of your time in a less expensive area?  One of the goals of this blog is to help you think outside the box.  Geo-arbitrage is one of those areas where you should let the creative juices flow!

 

 

 

The Glass is More Than Half Full

The Retirement Glass is More Than Half Full

This article looks at retirement from the glass half full perspective. There are enough doomsday scenarios out there. Let’s look at some positive developments!

We are Healthier than ever

Many of us are living longer than ever, and we’re staying active. There are sayings out there that 60 is the new 40, or 80 is the new 60, and there is an element of truth there. (Although as I personally approach 60 I don’t feel like I did at 40!)

Modern drugs and medical care, though far from perfect, are having a desired effect. There is a lot of good information out there on how to stay healthy. I’m sure we all have had the experience of meeting someone you think is in their late sixties only to find out they are in their early eighties!

More Opportunities than ever before

No longer are the choices to just keep working or retire to a life of the rocking chair and occasional trips to visit the grandchildren. Today’s retirees can do pretty much anything they want.

Work part time. Start a business. Volunteer or start your own non-profit. Run a marathon, hike through a national forest or go crazy with your favorite hobby. The only thing limiting today’s retiree is their own imagination.

Social Security isn’t going away

Rumors of Social Security’s death are greatly exaggerated. There are all too many articles about Social Security going broke but the bottom line is that although it may change, especially for younger workers, it isn’t going away.

Add to that the fact that many people can afford to take payments at an older age (like 70) in order to increase monthly payments, and Social Security is looking better than ever.

Plenty to do to fill our time

With all the opportunities out there the problem in retirement should not be having enough to do, but instead how to filter all the choices. The trick is to find what you really want to do, be it working, hobbies, activism or whatever.

Lots of opportunities to volunteer

Many volunteer organizations could not exist with retirees. Every type of person is needed from managers to ad-hock helpers. If an organization does not already exist for your particular interest then you can create one! Don’t forget the little things like giving a ride to the neighbor down the street to the doctor or picking up some groceries or just taking a few minutes to chat with a lonely friend.

Lots of Information is available

The sheer volume of information out there is mind boggling. The web is the storehouse for information on everything from retirement finances to hobbies and learning opportunities.

Definition of Retirement is changing

The retirement glass is more than half full mostly because the definition of retirement is changing. It is no longer retire at 65 after working for the same company for 30 years with a gold watch to life in the rocking chair. It can be anything you want.

Retirement is just the transition to a different phase of life. It is potentially the first phase in life where you have a lot of control. And it can be the best phase of life!

 

Why This Blog

Let’s Tackle a Big Problem

I read somewhere that we should “Tackle Big Problems.”  Retirement today is one of those big problems.  The reality is that most of us will never reach those lofty net worth numbers that well-meaning financial analysts keep repeating.  We hear people talking about it at work, family gatherings, in the news, and on the Internet.  There is lots of information out there telling us to save more and how we need a million plus dollars in retirement savings.  There is much less about the reality that many of us will never reach that goal, and what to do about it.

If you are one of those people that will never reach 2 million in retirement savings this blog is for you.  I want to expand the conversation beyond “you must save more” to discuss what to do if you can’t, or what to do if you are already there with a much smaller nest egg.  More than that we want to talk about how to thrive in that situation.

Glass Half Empty / Half Full

If you follow the media the whole retirement experience seems to be all doom and gloom.  We read about how no one is saving enough for retirement.  People plan to work into their 80s.  No one over 50 can find a job.  Medicare and Social Security are bankrupt and must surely end.  Like most things we read in the media there is some truth to it and that truth can’t be ignored.  However the old saying that bad news sells may be at work here and there is a lot of good news out there that doesn’t get as much coverage.  People are living longer and many times healthier.  Medicare and Social Security will eventually be modified somewhat but will not go away.  While many employers do discriminate against older workers some do not, and some even prefer them.  The Internet alone is providing opportunities for access to information and business opportunities that are truly game changing.  This blog will look at the good and the bad.  However we hope to present an alternative, useful, and positive viewpoint.

A Different Way of Thinking 

What is needed is a different way of thinking and problem solving.  Retirement without a giant net worth means you have all the non-monetary things to think about, like what are you going to do for the rest of your life?  But is also means you need to think a little outside the box, and not try to live up to the unrealistic ideas sold to us by the retirement industry.

Yes, a Budget is Important, But… 

Money is an important part of the puzzle, but only a part.  Equally important are things like health, meaningful work, helping others and how we occupy our time.  Actually if you take care of some of those other pieces you might find the money part just falls into place.  For example depending on your health your monthly health care expenses might be $100 or $2000+, a big difference indeed.  Occupying your time with a hobby that also makes you a little income can bolster the income side of your budget.  And let’s not forget that all the money in the world is useless if you are miserable.

Challenges 

What will we do with ourselves?

So what will we do with ourselves?  Well for one thing most of us will work in some fashion, either for somebody else or for ourselves.  That’s not a bad thing as it probably means you will live longer and happier.  We can discover hobbies we had never before even thought of.  We can help others in ways that were not possible before.  Travel is a great idea, in new and novel ways.  In general we can reinvent ourselves in ways we never thought possible.

Closing

I thank you for joining me on this adventure.  This blog isn’t meant to replace all the retirement information out there.  It is meant to make you think and open your eyes to alternatives.  We’ll explore those alternatives in the days to come.