It is much easier to leave the "rat race" without kids and travel. I also want to travel when I hit FIRE. I am 41 and really considering leaving my job at 45 as well but my kid will only be 7 so I think even if I leave, I'll still be tied down. And if I'm still tied down, I think I'll probably still work but at a reduced capacity.amz155 wrote: ↑Nov 27th, 2018 8:06 pmNo kids. Love our house, it's worth over 1M buuuuuut, I'm not in love with the idea of living in a house that's so big and paying taxes, maintenance etc. We stay here bc it's convenient for work but the moment we don't NEED to work at our current jobs, we will consider downsizing.
Anyway, I have this dream of not working at my current job beyond 45 years old. That's another 7 ish more years. But it's like, the more money we save, the earlier I dream of reaching FIRE, but then ironically, the farther away it seems to be possible. Why? Mainly because when we reach FIRE we want to travel. If we stop working at around 45 and are healthy, that's a LOT of money that it'll take to travel as often as we want to. In the ballpark of, I dunno, 20-30K a year?
I've thought about the travel thing a lot and here are my thoughts... It really isn't that much more required for travelling. Depends on how you do it.
Regarding your house. You have no kids and if you are planning on travelling, there is no need to keep it. If you had kids, you might need a bigger place but for the 2 of you, it is a waste. the best thing to do is rent especially when you won't be home much.
If you rent you'll pay something like $1500 for a 1 bedroom but you save so much on maintenance fees and property taxes. Which are probably somewhere around $600 a month. The only thing you miss out on is price appreciation but at that point in your life you don't need it. Take the $1M and invest. At 4% you're getting $40k back. That means an extra $2500 cash flow per month after taking rent into account.
If you then think about the expenses of travelling, the most costly thing is accommodations and flights. But if you think about it, accommodations are only expensive on a short term basis (1 or 2 weeks at a time). Rent a place for a month using the extra $2500 instead. As an example, I've been looking at Taipei. A 2 bedroom in Taipei downtown can be had for less than $2000 on Airbnb per month.
I'd go for a month or 2 at a time at 1 city and travel around that area. Then go back home a month or 2. You need to stay in canada to keep your OHIP and OAS active anyway. After a month or 2 at home go to a new city for another month or 2. Rinse and repeat for as long as your health lets you. While you're at home, the extra $2500 per month is not needed and can be saved for the flights to your next destination.
That means you are abroad for say half the year with flights and accommodations covered and all you had to do was downsize and rent. With accommodations and flights covered, how much more do you need for everything else? That's what you need to "save" for.
At home fixed (per month):
Rent - $1500
home insurance - $25 (renters insurance)
car insurance - $100 should be low because it won't be used much and parked most of the time
internet - $20 - say $40 normally but cheaper per month on avg if you suspend service while you are away (say half the year)
cell phone - $100 - 2 people (don't think you can suspend cell plan without losing it)
Hydro - $50 - if you are gone half the year, this should be half on avg (say $100 when you are here)
Food - $250 - again, half of the time you are abroad
Entertainment - $100 - assume half on avg
Gas - $50 - assume half on avg
Abroad - Avg per month assuming you are gone 6 months
Rent - $1000
Food - $500
Uber/Car Rentals/Taxi - $200
Gas - $100
Local Flights - $500
Entertainment - $500
Data plan - $50
Based on the above, I'm thinking you need a total of around $5000 (today's dollars) + maybe a buffer for other crap. I'd put it at say $6k per month.
$4k already covered by the $1M house. Only need $2k per month which is $600k invested. That means roughly $1.6M required to pull this off. Once you hit 65 or 70, you can start getting CPP and OAS which will cover inflation.
This is similar to your budget of $30k per year on travel. But I don't think you have thought about how your expenses at home will be significantly reduced when you are not living there.
I've got close to $2M in assets now. If I didn't have a 3 year old, I'd probably pull the trigger on the above right now.