Leverage International Geoarbitrage To Live A Better Life For Less

Today's guest post is from Jim at Route To Retire, an early retiree. His family of three decided to leverage international geoarbitrage to start a brand new life in Panama.

Jim is living a life that I eventually want to try once both our kids are old enough to remember their adventures (5+). If you've always wanted to learn how to move overseas to live a better life for less money, here's how they did it.


Becoming a millionaire was something I always dreamed of but, honestly, never really expected to become a reality. Through some intentionality in saving and investing though, that's exactly what happened by 2017.

The goal I was working toward was to retire early so I'd have freedom with each day. I wanted to enjoy the present more and be able to concentrate on time with my wife and young daughter. Seems like a reasonable goal, right?

However, I think we all know that a million dollars ain't what it used to be. And to make that last for possibly 45 years or more? That seemed like an impossibility.

So I started thinking that even though we lived in a pretty low cost-of-living area near Cleveland, Ohio, maybe there was somewhere else we could go that might be less expensive.

Then I realized that we weren't really limited to just the U.S. if we were no longer going to be working. Maybe we could move to another country and get more of a bang for our buck as well.

And that was it. Without even realizing it, I had discovered the idea of international geoarbitrage without even knowing that was a thing. The idea of taking your money and making it worth more by moving to a lower cost-of-living area can be an effective financial tool.

In our case, we decided to move to Boquete, Panama after going on a single vacation to the country in 2017.

An International Geoarbitrage Adventure To Boquete, Panama

Leverage International Geoarbitrage To Live A Better Life For Less

I retired at the end of 2018 from a 20-year career as the Systems Engineers manager at an IT support company.

If I knew better, I would have used the strategies in Sam's How to Engineer Your Layoff book to secure a severance beforehand. I've read the book since and know that I was a perfect candidate and would have likely pocketed some good money. Live and learn, I guess!

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I was 43 at the time of our retirement and our net worth was $1.2 million. That's a nice chunk of change but a little scary to know that we were counting on that to support me, my wife, and our daughter who was 8 at the time.

Still, we took the plunge and moved to Boquete, Panama in the summer of 2019. There are plenty of other places around the world that are a lot less expensive than Boquete. However, this transition was something pretty big for us already and we wanted to take a baby step.

Instead, we went with the approach of spending a little less money than we would in the U.S. but living a much better lifestyle. Boquete, Panama carries many similarities to the U.S. but that also means it’s more expensive than other places around the world.

Resort Living In Retirement

We're living in a beautiful fully-furnished 3-bedroom/2-bath condo in a higher-end resort on a golf course. We have access to a full gym, a couple of huge pools, and more. The mountain landscapes here are spectacular and everything's so lush and green with flowers so vivid it looks unreal. Our housing cost per month including utilities and internet… about $1,300.

Because it's 75 degrees here every day and we're only about a half-mile to town, we decided not to get a car. Walking to town with this mountain scenery is well worth not being cooped up in a car. Besides, taxis are everywhere and cost next to nothing when needed.

Leverage International Geoarbitrage To Live A Better Life For Less in Boquete, Panama - Resort Living

Essentially, we're getting beautiful San Diego temperatures for less than you'd pay for “standard” living in Ohio.

Censuses aren’t the norm here, but the population in Boquete is said to be about 35,000 with a ballpark of roughly 10% of that being expats. It’s not a huge town, it’s walkable, and there are a lot of others around who speak English (mostly expats). We are learning Spanish though because it does make like a lot easier.

Somehow in this small town, we have close to 100 restaurants serving up everything from Panamanian food to Italian, Mexican, American, Peruvian, Chinese, pizza places – you name it!

We also have a few grocery stores and can get almost everything we need here. Periodically, we head to David, a bigger city about 45 minutes from here for the things we can’t find here. Since we don’t have a car, we’ll usually take the bus ($1.75 each) there and take a taxi back ($25-30).

Let’s Talk Numbers On International Geoarbitrage

Ok, let’s get to the meat of things. International geoarbitrage can be beneficial for so many reasons. But, you probably want to know more about some of the numbers, especially if you want to retire early abroad.

Housing Cost

You already know our housing expenses… and $1,300/month is actually pretty expensive. We’re living in a fancy-pants resort. If we lived elsewhere in Boquete, we could easily find another fully-furnished place to rent for $750/month (including most utilities).

The cost of real estate is also less expensive than in the U.S. But like the U.S. it varies based on location and what you’re getting.

Grocery Expenses

Panama Grocery - International Geoarbitrage living for expats

Fresh fruits and vegetables are extremely cheap. We can easily get enough of these to fill a couple of canvas bags for $10.

Other groceries seem to be hit or miss. Items you wouldn’t think would make a difference are pricey here. Cheese, pickles, lunchmeat, bacon for example – they're almost twice as much as what we’d pay in the U.S. Other foods aren't too expensive, but they're still pricier than what we used to pay at Aldi.

On the plus side, beer is extremely cheap here. Usually less than $2.50 for a 6-pack.

I can also get U.S. beer here much cheaper than I can in the U.S. That might sound strange, but even with the additional cost of it being an import here, it’s not taxed out the yin-yang like it is in the U.S. I just bought a six-pack of Budweiser bottles on sale for $4.50 (usually $5.34).

We spend about $500/month on groceries for our family of three, including alcohol.

The Cost To Go To Restaurants

Dining-out costs depend on what you’re looking for to eat. You can eat a good meal in a small Panamanian restaurant for $5 for a meal. The three of us had a delicious and filling breakfast at one place for a total of $11.

Most standard, mid-level restaurants usually run the three of us $40-50 (including beer/wine). A high-end restaurant generally costs us $70-80 for all three of us. That’s without a tip, which is customary to be 10% in Panama though we usually go with 15%.

We’re spending less than a total of $45k/year and living an extremely comfortable lifestyle here. We live in a beautiful place in a nice condo, eat out once a week or so, and travel/vacation quite frequently. For a family of three, that’s about all I could ask for!

What About Medical Costs And Healthcare Quality Abroad?

Sure, you have some cheaper prices, Jim, and it sounds like the quality of life is pretty darn good. But the medical is crap, right?

This is one of the topics that comes up quite a bit with folks wondering about international geoarbitrage. That's reasonable since we’re from the U.S. and the cost of healthcare is both broken and stupidly insane. The average cost of family health insurance is outrageously high.

Health insurance is also the factor that keeps so many U.S. folks from being able to retire before the age of 65 when they can receive coverage through Medicare.

As far as the quality goes, the doctors are mostly trained in the U.S., France, and Mexico. I’ve been told that some of the equipment can be as good as and sometimes better than what we have in the U.S.

Although, we haven't frequented doctors offices or hospitals here, friends who have spent time there have told me that the quality of care they’ve received has been excellent.

I've been to a specialist here in Panama at a private hospital (as opposed to the less expensive public hospitals). It was a dermatologist appointment with an excellent doctor who spoke perfect English. The care was great and the cost with no insurance for my appointment… $60.

I paid in cash on the way out. No one cared that I didn't have insurance. There were no weird copays or waiting for months to know what my payment responsibility would be, and no arguing that something got coded wrong. Yup, $60 and I was on my way. And this is for extremely good medical care.

To Get Healthcare Insurance Or Not While Living Abroad

Some expats who live here pay to insure directly through the hospitals. Costs can be less than $150/month. Other folks get insurance through regular insurance companies where they pay less than $100/month with a deductible of $5,000.

And many expats just don’t get insurance at all. The costs are so cheap that they just self-insure and pay in cash when things come up.

In our case, we have very good expat insurance that covers us wherever we are. We signed up for that not specifically for Panama but mostly for when we travel back to the U.S. If we got in a car accident or something there, the costs could be insane.

Our expat coverage requires that we be out of our home country (the U.S.) for 6 months out of the year. Other than that, our premium for the silver plan is a total of $317.05/month for the three of us. Our deductible is $1,000. Not too shabby, right?

Related: Average Retiree Expenditure On Housing, Food, Transportation And Healthcare

What’s It Like To Actually Live Abroad?

It's not perfect here (no place is), but I'm so glad we decided to give this a shot in Boquete. The people are friendly, the landscapes are beautiful, and it's hard to complain when your beer at a restaurant or bar costs only a buck!

Beach in Panama

It’s 75° here every day, which makes it perfect for taking a walk around the resort, walking around town, hiking, zip-lining, horseback riding, or most any daily activity. I know the golfers love it!

Maybe you’re thinking that's too cold – what about beach weather?!

Here’s the thing, we purposely moved to the mountains because it’s cooler and we don’t have to live in air conditioning. This is great for everything we want to do on a day-to-day basis.

And when we want to bask in the sun and spend a few nights at the beach, we just head an hour or two down from the mountains. Suddenly, we have access to some beautiful beaches and resorts and the temps are in the high 80s. We really get the best of both worlds.

Here’s something to consider though… we’re not living on a permanent vacation. Although we have a blast doing beach outings periodically, going on hikes, zip-lining, whale-watching, or other fun, we still have normal lives. It can’t always be a vacation.

We still have laundry to do, bills to pay, and homeschooling to do (well, Faith has homeschooling to do).

Just Another Typical International Geoarbitrage Day

On regular days, I head to the gym while Lisa works with Faith on homeschooling. Later, we might go grocery shopping or run some other errands. Occasionally, we’ll go to lunch or dinner at one of the many restaurants here.

Most of the locals here only speak Spanish. But sometimes we’ll run into someone who speaks English somewhat as well. We’ve gotten better with our Spanish and that’s made conversations much easier.

The Panamanians as a whole here are welcoming. And between our broken Spanish and their broken English, we always get things figured out.

Boquete is a big expat community so there are a lot of folks around from the U.S. or Canada who speak English as well. It makes it a whole lot easier to learn the ropes when you can meet people who’ve been there and done that.

We’ve made a lot of friends here and enjoy the camaraderie. COVID obviously threw a wrench in the works from hanging out with other people. But hopefully, we’ll be back to that again soon.

The Downsides Of Living Abroad

Life is good here and pretty easy-going, but there are downsides. We do miss family and friends. It’s hard to be away from everyone you know for so long.

The upshot is that since we’re living as tourists here, we have to leave Panama every 6 months for at least 30 days. That gives us an opportunity to head back at least a couple of times a year and spend a month or longer visiting everyone.

With regards to the expats, Boquete is mostly a community of older retirees. So there aren’t a lot of English-speaking kids here. Because of that, you can imagine that Faith (daughter) doesn’t have a lot of friends here. She does have one really good friend though. And they’re like two peas in a pod when they get to hang out together.

Is International Geoarbitrage For You?

International arbitrage with Jim from Route To Retire

International geoarbitrage isn’t for everyone. To appreciate it, you have to be someone with a sense of adventure. You also need to be willing to accept change and go with the flow.

It’s important to realize that homesickness could affect you dramatically while living far from home. Missing family, friends, and even the lifestyle you’re used to can weigh heavy on your shoulders. That has the power to drive you back to your home country.

If missing home is big concern, finding a place closer to your home country could be useful in giving you the ability to head back more often to visit.

Regardless of the country you might be considering, it will be different from your home country. Not only are laws different, but people and customs are also going to vary from what you’re used to. Certain things you might appreciate and others will drive you nuts.

But if you’re going to live abroad, you need to accept that not everything’s going to be the same as you're used to. Learn to appreciate those differences and you'll likely love living in another country. Be annoyed or upset about the differences and you’ll be miserable wherever you are.

Factors To Consider If You Want to Live Abroad

Every country's going to be unique. I can only speak about our experiences living in Panama. You need to consider some of the many factors that’ll come into play in choosing a place for international geoarbitrage. If you're determined to live abroad, here's a list of considerations when researching overseas locations.

  • Cost of living: Some places are extremely cheap to live in but generally at the cost of being less developed. A great website to compare the cost of living difference between cities around the world is Numbeo.
  • Weather: Is it hot, cold, rainy, or windy? Are there natural disasters you need to be concerned with?
  • Healthcare: Is the healthcare in the country good? Is it readily available?
  • Economy/Stability: Is the economy solid and growing or is the country on the downhill? Living in a struggling country could have a big effect on your future and safety.
  • Crime/Safety: The above bullet is one concern, but how about in general? Are homicide rates, break-ins, or petty theft high in the area?
  • Things to do: Does the area you’re looking at check the right boxes for restaurants, hiking, biking, entertainment etc.?
  • Ease of gaining residency: Not every country is going to let you just waltz in and become a resident. In Panama, we decided to be perpetual tourists and that’s worked well for us. If you want or need to establish residency can you meet the requirements?
  • Other expats/Welcoming to expats: Is the area you’re moving to filled with other expats? Having others around who have been in your shoes can be extremely helpful. It also makes life a little nicer if the locals are welcoming.
  • Language: A lot of the countries people consider moving to aren’t English speaking. Learning another language can be challenging, but it can make life much easier.
  • Distance to home country: If you’re unsure about leaving family and friends behind, perhaps distance is important in your choice.

No Perfect Place, But Lots Of Good Ones

Above are just some of the things you’ll want to consider. Making international geoarbitrage work means finding a place where the criteria that matter most to you rise to the top. 

Chances are, you’re not going to find a place that checks everything on your list. No place is perfect and expect to make some concessions along the way. The goal is to find a country that meets as many of your important criteria as possible.

International geoarbitrage can be a powerful financial tool and can also provide for a better quality of life. It’s not for everyone. But if you’re up for it, it can make a tremendous impact on your life.

Readers, have you ever considered living in another country to take advantage of the cost-of-living or quality-of-life benefits?

From Sam: It's great Jim is maximizing his freedom in retirement. He hasn't let the pandemic slow them down. As someone who grew up overseas for 13 years, I know their travel experiences will only appreciate in value over time.

I also like how Jim touches upon the ups and downs of no longer having a steady paycheck.

39 thoughts on “Leverage International Geoarbitrage To Live A Better Life For Less”

  1. I am Turkish and I live in Turkey. This country is expensive if you earn in Turkish liras, but if you earn in dollars, you have a very good life. My problem is I do not earn money in dollars ;D Do you have advice about how can earn in dollars? My age is 20 and I am just a uni student.

  2. I think geoarbitrage is a hugely underlooked financial opportunity that a lot of people aren’t considering. I think there’s things in a similar vein in the medical category where people go abroad to do certain surgeries because it’s much cheaper over there.

    The world is a huge place, and other than the short-term language barrier, there’s no real reason to believe that we can’t find a nice place with a great quality of life in a place that’ll make our net worth FIRE goal a lot easier to attain.

    And one might still attain their regular, USA FIRE net worth, but then choose to live somewhere much cheaper to established a huge safety margin (or live like a king there).

    Thanks for this article!

    1. Jim @ Route to Retire

      It’s funny to think about the preconceived notions I know I had before we decided to make this a reality. Being here in Panama has helped me to realize that there are other wonderful places in the world. The people here (both locals and ex-pats) have been so welcoming and friendly in general.

      And although we haven’t had a medical emergency (knock on wood), both Lisa and I have done some routine things and the hospitals here and I’ve been very happy with how things went and, of course, the costs. Even when we move back to the U.S., I will absolutely be considering medical tourism should the need ever arise.

      Your point about attaining FIRE based on living in the U.S. and then going somewhere cheaper to live is the route we went. We’ve lived very nicely here in Panama but we can still afford to live in the U.S. – though not in the luxury we get here. :-)

  3. Hi Jim

    Great and informative article.

    I am curious about how you settled on the place you are renting. Are their websites that you would recommend for people looking to rent or buy in Panama? Or any organizations that help ex-pats find a place to live.

    Thanks and I’ll be checking out your site today

    1. Jim @ Route to Retire

      My recommendation is to find an Airbnb or short-term least to live in for at least a month when you move to a location and then start looking around. That’ll give you a better chance to get a lay of the land and figure out the areas you like best. It’ll also give you an opportunity to get the word of mouth going since a lot of times places won’t be listed. And a huge help are the Facebook expat groups for the area you plan to move to.

      I put together a giant post relating around some of this a while back that you might enjoy – Moving to Boquete or Visiting? The Ultimate List of Tips!!

      The info I gave is how we found our place. We got an Airbnb for a month, determined where we wanted to be, and got the word of mouth out through several outlets. We ended up finding the place through an agent though just through dumb luck. But it’s worked out well and we’ve been in the place for 2 years now.

  4. I’ve often thought about moving overseas but I would have to sell my house and be out of my city for good as prices keep rising. Not sure if I am ready to make a permanent decision.
    Kids schooling and safety is also an issue for me.
    However as US cities decline and the cost goea up I may have to reconsider.

    1. Jim @ Route to Retire

      It’s not for everyone, Billy, but you might be surprised by some things. For instance, the homicide rate here in Panama is less than in the U.S. We actually feel safer walking around here at night than we did in the States. I can’t say that everywhere’s like that, but there’s a perception that gets ingrained in our heads that the U.S. is the best place to be and that’s not necessarily the case.

      The international schools are also supposed to be very good from what I understand and when you’re in a lower cost-of-living place like Panama, the prices usually reflect that as well. Paying less than $3k/year for private school ain’t too bad of a deal! ;-)

  5. To: Jim at Route to Retire, how did you establish your state residency for tax reporting purposes? Did you decide to stay with the same state or did you change it to a different state?

    1. Jim @ Route to Retire

      Great question, Paul! We’re actually residents of Texas now. We changed our state of domicile shortly before we moved here to Panama.

  6. I’ve come across Jim’s blog before. It’s a great primer to geo-arbitrage, especially for regular FIRE folks (non-fat). In my adult life, I’ve logged in 7 years in Europe, 4 in Asia, 1 in S. America, that I’m not sure if my future lies anymore in the US. At present, I’ve geo-arbitraged back this summer to NYC from high-cost Hong Kong where I paid $5300 a month rent for a 690 sq ft apt in a 2009 building! We have UK, EU and HK passport so not sure where to land.

    Several practical/financial things worth noting:

    1) Expats tax breaks: you can claim both Foreign Earned Income Exclusion (up to $110K per person, or $220K a couple), as well as the Foreign Tax Credit (taxes paid to a foreign gov’t, applied to your US tax liability) AND foreign housing credit. Our best year we made $770K W-2 income annually, but our net effective tax rate was only 12.5%!

    2) Health Care: Expat insurance plans are cheap if they don’t include US coverage. They are also underwritten, so I got a huge jump when I turned 50 because of the new age bracket. They also took into account my cancer history (9 years out) and bumped the cost up. Health care for straightforward needs and light surgery, etc. is often great, but navigating the culture of medicine, (how the system works is not good in a foreign country if you have a serious illness). Be prepared to be completely surprised the things you don’t even know to ask doctors, hospitals, EVEN if you speak the language fluently. Best to keep a catastrophic plan so you can go back to US for the big surgery/cancer treatment, etc.

    3) Community Is Everything: Unless moving to a major Western city with enough diversity, expat/local communities vary greatly in terms of profile and local integration. Moving to a new country can be similar to moving elsewhere in US. The loneliness/isolation creeps in when you realize you’re making yourself fit into the location because they are not your “peeps.” The journey *typically* starts with a) Euphoria/sensory overload where everything is new and exciting, followed by b) greater awareness of the realities of local day-to-day living, leading to c) frustration with the local ways of doing things, constant annoyances with the natives and their culture, or homesickness to d) true acceptance…where you let go of your cultural biases and unconsciously absorb many of the host country’s values. If you can survive “phase C” –anywhere from 1 year to 3 years or never –, you end up staying longer and truly integrate. That’s when you get reverse culture shock coming back to US and find Americans and their ways alien and realize the country’s moved on without you.

    Curious if Jim will stay in Ohio longer-term. Living abroad changes you and you return a different person/family, though kids will easily slip right back in.

    1. Jim @ Route to Retire

      All three of those are excellent points! The FEIE is a jaw-dropper in itself – it’s crazy how much more money you can make just because of that.

      I agree with you about community as well. It’s nice because every single ex-pat has been in the same situation you have so there’s already a sort of established bond and a willingness to help each other. We found the ex-part community here extremely welcoming and we’ve been able to make friends pretty easily.

      Tough to say if we’ll stay in Ohio for the long term. Personally, I could probably stay here in Boquete forever and be content. However, Lisa and Faith get homesick and that’s the tough one. We also want Faith to be around more kids (Boquete’s an older ex-pat community). I’d like to think that’ll we’ll come back here (or maybe even another place) once Faith’s older and moved out. But will we want to be close to help her as needed or what about if she gets married and has kids… our grandkids? Time will tell, I guess.

      We’ll play it one day at a time and figure it out as we go. In the meantime, we’ll make the most of whatever we’re doing! :-)

      1. Have you considered having Faith attend a local public school? It might offer her the opportunity to make local friends and definitely improve her Spanish.
        I can understand the desire to homeschool but if you are considering Panama long term it would help to integrate her and you into the local community.

        1. Jim @ Route to Retire

          Hi Alan – my understanding is that the public schools here are not very good and that they’re 100% in Spanish. The international schools though are reasonably priced ($2,500-$3,000/yr) compared to private schools in the U.S. and would be a great way for Faith to improve her Spanish and make more friends.

          However, the pros of homeschooling right now seem to outweigh that for us personally. Because we needed to leave the country every 180 days for a month as tourists (which has just been announced that we’ll only be able to stay 90 days at a time starting 10/1), the schooling would be difficult. We also love to be able to travel with her and that makes homeschooling easy. Having the ability to teach 1-on-1 with her is also amazing. She’s not wasting time on things she understands and we can work to improve anything she needs extra help with. Not only that, but we design the curriculum so we include things like Spanish and a personal finance class (taught by yours truly, of course!). And, I’ll tell you what, homeschooling turned out to be a blessing during the pandemic – an easy transition for us.

          We recently decided to move back to the U.S. next spring () so a lot of this will become not as relevant, but we’re going to continue to homeschool her for at least another year once back just because it’s worked extremely well for the three of us. If we had decided to stay here for the long-term, we would have obtained residency and probably at least considered the international school option a little more.

          As a side note, she does have a couple of friends here, including a very close friend. The problem is that she’s about a 10-15 minute drive from here so we need to schedule days/times for the girls to get together. It’s not like you can just say, “go outside and play with your friends” because there aren’t a lot of neighborhood kids here.

  7. Sounds like a great life for you and your family, Jim! Do you mind sharing which company you purchase your silver expat health insurance plan from? Thanks!

    1. Jim @ Route to Retire

      Sure, we’re using IMG Global (https://www.imglobal.com/) right now. Unfortunately, I can’t tell you too much about how good they are since we really haven’t needed to use them, which is probably a good thing! But I have talked to their customer service a couple of times during the beginning of the pandemic regarding COVID testing and I was very satisfied with that side of things.

  8. Great story! Coronado has been on my list to check out. We have four kids and don’t want to do homeschooling, so we need some sort of international school. This raises the cost, but is something we think important. But congratulations on your successful move, and I hope you enjoy it for many years to come!

    1. Jim @ Route to Retire

      We stayed in Nueva Gorgona (right next to Coronado) for a few days when we did our first “recon mission” to check out Panama. It’s a nice area with a lot of expats and some much-less expensive beachfront property.

      A huge pro to enrolling your kids in an international school will be the opportunity for them to meet other kids. Plus, I’m told the international schools can be really good here.

      Good luck!

  9. That’s an inspiring read, thanks for that detailed article.
    Geographic arbitrage is an issue, my wife and I have been discussing a lot recently. We want to reach FI by the end of 2024 and are quite well on track. We live in central Europe and living costs etc. are quite high, the Swiss francs is strong compared to the Euro, so we have been thinking of making use of geographic arbitrage, e.g. France would be great and we also have some relatives there. But of course there is also a flipside you describe in your article to which we can relate to a lot. Being away from our parents, friends, and most important point for us: our kids would have to change school, living in a complete new environment etc.
    The good thing is that we can take our time to assess the option of geographic arbitrage, assess, discuss and think it through. If well prepared and well implemented, it will be a fantastic adventure and great opportunity for all.

    1. Jim @ Route to Retire

      The other important factor to consider when using geographic arbitrage, especially internationally, to reach FI faster, is what if you get there and don’t like it? Assuming you quit your job to live in another country, if you hate it, you then have to decide – do you go back and be forced to get a job again because your cost-of-living goes back up or do you stay there and be miserable?

      Luckily, my wife brought that up as we were starting to consider this. So I worked long enough to ensure we’d have enough money to live in the U.S. as well (though we’d get a better quality of life on our money in Panama).

      It’s a wonderful adventure living in another country and really helps you to understand other people and their cultures.


  10. Financial Samurai


    I’m one of your posts, you write,

    “ Fortunately, though, I happened to retire during a phenomenal bull run in the stock market. On the day I retired on 12/31/18, our net worth was $1,127,049. As of 08/01/21, it’s now $1,634,608.00… even after completely funding our expenses over the past few years!”

    That, to me is the dream scenario where you get to live your life without having to work and seeing your net worth go up as well.

    My question is, with a 45% increase in net worth, or $500,000 more than when you had enough to leave in the first place, why do you really think you want more?

    Paying $100-$200 for outings with friends you mentioned shouldn’t make much of a dent at all! Also, it doesn’t sound like you guys are going to have another kid, so costs should be relatively fixed.

    So I’m curious how much the wealth of others is driving you to want more. Or another bigger reason?



    1. Jim @ Route to Retire

      That’s a fair question, Sam. I was just telling Lisa yesterday that this really is just a mental hurdle on my part. We have enough money to cover our expenses (and more) but I still seem to be watching every penny more closely than I need to. Maybe that’s just the way it goes after being so frugal for so long.

      The bigger costs aren’t really the occasional expensive dinners but rather the bigger costs of frequent traveling.

      But no, I don’t think it’s envy of others’ wealth. Of course, the more $$, the merrier, but we’ve got enough dough to cover our lifestyle. My thinking that more would be better is likely me trying to solve a problem that can’t be solved by money. My guess is that even if we had twice as much money with a 2% withdrawal rate, I’d still be counting pennies like a madman! :-)

      1. Ok good to know. Let me know if you ever overcome your mental hurdle and how! I’m trying to consistently jump over it as well.

        I’ve been revenge spending this year by spending up on nicer food. I’m also paying for preschool tuition again after 16 months.

        But there’s nothing else to spend money on. No flights, don’t need a new car, have my sports equipment, don’t need clothes. So all that’s really left is food and educational items for our kids.

        But I’m ready to spend up on a nice hotel/rental house and flights if we ever travel again.

        Check out: The 10X Investment Consumption Rule


  11. re: “It’s 75° here every day … Maybe you’re thinking that’s too cold”

    Too cold???? That’s my PERFECT temperature! Especially with sunny days, blue skies, and not too much wind. ;)

    1. Jim @ Route to Retire

      That is the right temp for me as well – makes it awesome for walking around in. In fact, we never have to even think about what we need to wear – it’s shorts and a t-shirt every day and maybe a long sleeve for the cooler evenings.

      It’s not perfect though – it’s in a rainforest so we get a lot of rain in the late afternoons for a good portion of the year and we get high winds in January. Other than those small things to nitpick at, it’s hard to complain! :-)

  12. Sam –

    This is an excellent and well detailed article. How would this also impact US investors who invest in international investments as part of a well diversified global portfolio?


  13. This is not encouraging. Sure everyone’s goal here is to retire early, BUT not at the expense of living in pseudo poverty. The point of retiring early is to live well. Well, thanks hats my opinion and I’d really enjoy the discussion some day.

    1. Hi Ted – the key is how much you plan to spend in retirement. For us, the number was already at around $45-50k/yr, which might seem low for some folks, but this was where we stood regardless. The difference is that retiring in Panama allowed us to live a higher quality lifestyle for less.

      No problems retiring here on more, of course! The more you have, the higher the quality of living you’ll get. Being able to live in a place that’s 75° F every day though without the costs of a high cost of living like San Diego or San Fransisco makes it even more desirable.

      It’s not for everyone for sure, but I love the temps, the people, and the lifestyle here. :-)

  14. How fascinating. I never thought about living abroad as a permanent tourist. Having to fly back to comply with visa rules would get cumbersome for me but it all depends on the country and frequency I guess.

    Do you pack up all your stuff for your trips back to the US and a new unit when you return? Or do you continue to pay rent for the month(s) you are away? I’m assuming the latter for convenience sake.

    Boquete looks like a beautiful place. First time I’ve heard of it. That’s nice there’s a large expat community to socialize with as well.

    Do you think you will stay there indefinitely, move back to the US when your daughter reaches high school age, or perhaps move to a new place when you get into your 60s/70s+?

    Btw, smart on having the health insurance that you do for emergencies for the time you’re back in the US. I can’t imagine getting stuck with unexpected hospital bills without insurance. That would be crippling.

    1. Jim @ Route to Retire

      Be aware that we don’t need to live as tourists here. We could get residency, but with attorney fees, it would run us about $7,500. We didn’t want to go down this path until we were sure we wanted to stay here for the long haul, so living as tourists has worked well for us.

      We’ve always left our stuff here and just continued to pay rent while back in the U.S. However, on this upcoming trip in November, we’re going to be moving to a new place so we ended our lease in mid-November and started a new lease at the new condo in mid-December. That’ll save us a month’s rent so that’s a bonus. And our neighbor is letting us store some things at her place while we’re gone.

      Boquete is a beautiful place without a doubt. Even if you don’t plan to live here as an expat, it’s a wonderful place to visit regardless. It’s not a party atmosphere though if that’s something you love.

      We’ve been here a couple of years now and our daughter’s 11 now and loves it here. The one problem is that Boquete’s an older expat community. We’re actually planning to move back to the U.S. next April so she can be around other kids more. Plus, my wife and daughter get homesick so it seems like the right thing to do. We’ve talked about moving back here to Boquete once she’s older and moved out though.

      Yeah, if we lived here 24×7, the insurance might not be as important. But with our visit back to the States, taking a chance could be the end of our early retirement!

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