Our 2022 Expenses

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Early retirement isn’t all sunshine and rainbows, especially when you have to deal with what I like to call “The 4 Horsemen of Early Retirement.” Specifically, running out money, losing your identity, losing your friends, and dealing with inflation.

Because we’ve lived through multiple market downturns in the past 8 years of retirement and built a solid recession-proof portfolio, I wasn’t afraid of the first horsemen. And we managed to slay the 2nd and 3rd, by building whole new author identities, and an amazing community through Chautauqua and the digital nomads.

But this past year, the 4th horsemen reared its ugly head. This past year, something happened that I wasn’t expecting. Specifically: Inflation.

In times of inflation, employees can ask for raises to offset it and nomads can use geographic arbitrage.

But what if you’re forced to spend time in expensive countries, taking care of aging parents or for other family reasons? Will you now be forced to crawl back to the boss you gave the finger to on your way out nearly 10 years ago and beg for your job back? And how exactly are you going to do that now that your resumé gap is wider than the grand canyon and the Amazon combined?

Outside of 2008-style stock market crashes, the number one financial fear that retirees have is how to survive periods of high inflation. And given that inflation in the US and Canada clocked in at a whopping 9% and 7%, respectively, for 2022, this does not bode well for FIRE people.

So, how did we fare this year? Did our costs shoot to the moon? Is it time to dust off our resumés and go back to work?

Well, according to the 4% rule, we’re supposed to be able to safely withdraw 4% of our starting amount each year, adjusted for inflation, and have a 95% success rate of never running out of money. And since this rule takes into account inflation, we’re also supposed to be able to raise our yearly withdrawal by 2%.

Given that we’ve been retired for the past 8 years, adjusting for 2% inflation each year and 7% in 2022, we should be able to safely withdraw…

YearWithdrawalInflation
2014$40,000.002.00%
2015$40,800.002.00%
2016$41,616.002.00%
2017$42,448.322.00%
2018$43,297.292.00%
2019$44,163.232.00%
2020$45,046.502.00%
2021$45,947.432.00%
2022$49,163.757.00%

Up until now, we’ve been spending the following yearly amounts for the 2 of us…

YearSpending (CAD)Spending (USD)
2016$40,143$31,661
2017$33,016$26,040
2018$40,519$31,800
2019$43,053$33,789
2020$33,965$26,788
2021$39,029$30,782

So, how much did we end up spending in 2022, the year with the highest inflation since we retired in 2015?

*drum roll*….

In 2022, we ended up spending…

$42,916 CAD or $31, 618 USD!

Here’s a monthly breakdown of our costs:

MonthSpending
January$2,634.00
February$3,133.00
March$4,617.00
April$4,186.00
May$3,416.00
June$3,421.00
July$3,287.00
Aug$3,375.00
Sept$3,602.00
Oct$4,828.00
Nov$3,299.00
Dec$3,118.00
Total$42,916.00

Here’s how our costs averaged out per month, broken down into categories.

CategoryCost (CAD)Cost (USD)
Airbnb$183.00$134.56
Rent (utilities and parking included)$1,500.00$1,102.94
Eating Out$505.80$371.91
Groceries/Booze$525.59$386.46
Transportation$302.58$222.49
Entertainment$137.82$101.34
Clothing$36.90$27.13
Cell  Data + Internet$55.87$41.08
Travel Insurance$31.70$23.31
Other (person items/gifts/donations)$297.07$218.43
Total$3,576.33$2,629.65

*Note: Airbnb costs are for places we travelled to that didn’t have a Home Exchange available.

If we graph our annual expenses for the past 8 years with the 4% withdrawal rate adjusted for inflation each year, this is what we get:

This shows that we’ve been consistently spending below the 4% withdrawal rate every single year, even after adjusting for inflation. And this year, even with 7% national inflation in Canada, we’re $6248 under how much we’re supposed to withdraw. There are three reasons for this:

  1. We locked in a pandemic rent rate of $1500/month in a building built before 2018, with rent control. The landlord is legally not allowed to raise rent by more than 2.5% in 2023.
  2. We used Home Exchange when travelling, which saved us (mostly) from paying double rent. We still had to pay some Airbnb travel expenses for places that didn’t have Home Exchange but it was far less than what people pay to go on vacation.  
  3. We’re retired, which means we eliminated “paying to work” expenses like commuting, eating out every day to save time, expensive after work hours gym memberships, decompression costs, professional clothing. Etc.

And what’s even more interesting is that going forward, now that we’ve optimized our portfolio even more to give us a 30%+ raise in yield, we can now spend up to $60,000/year!

Here’s a look at how our yield increased overtime, overlaid with our yearly expenses…

YearSpending (CAD)Portfolio Yield
2015$40,000$35,000
2016$40,143$35,000
2017$33,016$37,695
2018$40,519$38,124
2019$43,053$39,879
2020$33,965$38,284
2021$39,029$43,880
2022$42,916$46,985

Technically, we reached Dividend FIRE in 2020, but that’s only because our expenses plummeted (as did everyone else’s) from not being able to go out due to lockdowns. That was a weird year, so we wanted to wait until a more “normal” year to be able to see if this phenomenon stuck around.

Now that the pandemic is behind us, this year’s expenses is a more realistic spending level going forward and it’s still below our ever-increasing yield. So, this point, we are happy to declare ourselves comfortably Dividend FIRE’d!

Portfolio B Expenses

Long time readers know that in order to keep our retirement experience pure, we live off of Portfolio A, which is the original $1 million portfolio we retired on, while segregating all the income we made post retirement into portfolio B. That way any bonus money we spend that is outside of living expenses like business expenses, donations, paying for dinners/entertainment/etc for friends and family, and courses or tools for self-development and education, can be recorded as optional, luxury costs.

We do this mainly for the benefit of you, the readers, because as long as our base costs remain within the 4% rule of our original portfolio, that means that FIRE works even if you don’t end up making money on a post-retirement side hustle like we have.

Here’s how much we spent on Portfolio B this year:

$4,649

Most of this spending was on friends, family, and donations, followed by educational spending on the Travel Summit, and the business expense of upgrading our phone to take better pictures for this blog.

What’s interesting is that even if you add up our base expenses of $42,916 and extraneous frivolous spending from Portfolio B, you get $42,916 + $4,649 = $47,565, which is still below the inflation adjusted safe withdrawal amount of $49, 163, and close to our 2022 dividend yield of $46,985.

Is it Time to Increase Our Spending?

In 2023, with the recent changes to our portfolio, our yield is projected to jump to $60,000 a year. Which means, at our current base spend of $42,916, we are $17,084 under our new yield. And even with a “base + frivolous annual spend” of $47,565 that includes Portfolio B spending, we will still be $12,435/year under the yield. So, potentially we can increase our expenses by $1036 – $1553/month this year and still have a 100% success rate of never depleting our portfolio.

Don’t worry, I’m not just going to go out and start buying Louis Vuitton bags. Status-driven things, to me, are a complete waste of money. Plus, I enjoy optimizing way too much.

I thought about spending it on experiences—like elevating my travel experience. But since I went to the travel conference and learned how to travel hack business class flights for free (or nearly free), I don’t need to spend money on that either. And Home Exchange is working out just fine for travel accommodations (in fact, the places we’ve stayed in are way better than Airbnb!).

So, I’ll mostly likely just spend that money on friends/family/donations, given that spending on others increases your happiness.

What would you spend an extra $1036/month on? Let’s hear it in the comments below!


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47 thoughts on “Our 2022 Expenses”

    1. A portion of those ~ 49 000 CAD$ of income is not taxed at all since it is earned inside a shelter account (TFSA income). The balance, originating from a taxable account or RRSP is probably not sufficient between the two of them to incur any income tax after all deductions and credits are applied.

  1. I remain super intrigued by your Yield Shield concept. Unfortunately it looks like Vanguard long ago got out of the preferred shares ETF scene. Right now in the accumulation phase I’m going 100% VTSAX. If (for instance) I won a $1m lottery tomorrow, as a US investor with a Vanguard account, what’s a solid way to dump that into happily spinning off a ZPR-style fat dividend like y’all have managed?

  2. Yup.

    Things are definitely much easier if you don’t need to pay for healthcare AND you’re lucky enough to have gone through a 12-year, uninterrupted raging bull stock market (2009-2021) to buttress your finances and grow your portfolios. That’s the main takeaway from this post.

    I wonder what FIRE would be like now that the 12-year bull market has ended. Will it still be as popular? What are your thoughts?

    1. From an accumulation perspective, a bear market/recession (as long as employment is maintained) is the best case scenario.

      My wife and I are on the path, and although our current net worth has taken a hit, even if the market trades flat to now for the next 3+ years, our FI end date only moved out 6 months. Likewise, we have had the opportunity to pour in money at a discounted price, and when the market recovers, we will likely see 1+ year shaved off.

      The 4% SAWR is backtested with data including the great depression, and the “failure” condition is starting to see your nest egg be spent down, so you go back to work, like literally every other person in the world. It is not difficult to earn enough to cover expenses when you are a part of this community and have a frugal lifestyle.

      It is funny to read comments like this, because, as the great GodFather of FI J.L. said at Chautauqua this year, “this time is different” is going to be coming.

      Healthcare is a pretty minor expense even in the US (especially if you retire early and live on very low taxable income, as Kristy & Bryce’s book outlines), and, assuming you perform proper preventative care for yourself. “An ounce of prevention is worth a pound of cure.”

      1. “Healthcare is a pretty minor expense even in the US (especially if you retire early and live on very low taxable income, as Kristy & Bryce’s book outlines), and, assuming you perform proper preventative care for yourself.” This is an utterly absurd statement. If you perform proper preventative care for yourself AND manage to not get leukemia or hit by a drunk driver, or any one of thousands of other medical conditions that come with a litany of non-covered copays, deductibles, and out-of-pocket expenses.

        Surprise Ryan: people can get sick or hurt withOUT being at fault.

        1. First, it is certainly a less absurd statement than implying that you can possibly mitigate any of the risks that you listed that are uncontrollable. I didn’t imply not having insurance, I implied income based insurance (ACA/ObamaCare, which is why i mentioned their book, so you would certainly have coverage in the case of leukemia).

          Fault is actually an important point to refute your second example. Theoretically, if a drunk driver hits you, your insurance actually doesn’t need to cover anything, since there would be a lawsuit and they would pay damages…and Vehicle insurance covers accident related injuries…so this is a VERY odd example to cite.

          To match your style of comment -> Surprise Allison: we all will die and no matter amount of working extra years or buying insurance will mitigate that.

          1. Thanks for your quick reply Ryan, I guess I hit a nerve. I’m aware we’ll all die. I’m talking about while we’re still alive.

            Are you aware that most insurance policies refuse to cover many things that are necessary for quality of life and can cost hundreds or thousands of dollars? I could cite dozens of examples from my own health and that of the many patients with whom I’ve worked.

            People who arrogantly cast aspersions on others with medical needs often like to say “if only you did this/acted like me, you wouldn’t have that problem”. Prevention is important, but so is luck, and sometimes those “healthy” people haven’t been smart, just lucky.

            1. No nerve hit at all.

              “Are you aware that most insurance policies refuse to cover many things that are necessary for quality of life and can cost hundreds or thousands of dollars? I could cite dozens of examples from my own health and that of the many patients with whom I’ve worked.”

              I 100% agree with this take, but I am unsure what your proposal is, as it applies to retiring early. Are you saying that since health insurance companies refuse to cover things many claims (which is ridiculous, I agree), one should work for an employer for longer?

              “People who arrogantly cast aspersions on others with medical needs often like to say “if only you did this/acted like me, you wouldn’t have that problem”. Prevention is important, but so is luck, and sometimes those “healthy” people haven’t been smart, just lucky.”

              I agree with you on this. Certainly genetic predisposition has an uncomfortably large part in long term health risks, however, that isn’t something we can control, so in an analytical fashion, we should all take an active role to mitigate risks where we can.

              As a summary, I don’t think any of these risks or issues are impacted by retiring early, since, as we established, many employer sponsored insurance plans don’t cover claims sufficiently, but neither will ACA/Obamacare since coverage is similar. If you disagree, please bring this conversation back from “problem finding” to relevant discussion to the context of the article.

      2. I wouldn’t say health insurance is a “pretty minor expense even in the U.S.”

        Even with Obamacare, there are strings attached such as there’s a MINIMUM income requirement for enrollment, high deductibles and out-of-pocket maximums, etc.

        No matter how well you think you take care of yourself and how good you think your health is, diseases such as cancer can strike anyone without rhyme or reason.

        See here:

        “1 in 2 people will develop cancer in their lifetime” !!

        https://www.medicalnewstoday.com/articles/288916

        1 in 2 !!

        1. Crescent –

          I don’t disagree, however, many employer insurance plans have comparable coverage in the event (for example HSA qualifying high deductible plans).

          My point isn’t that healthcare isn’t corrupt, my point is that ACA/Obamacare plans keep monthly costs low with comparable coverage to many working American’s employer provided insurance.

          In addition, in the event of something severe, Kristy and Bryce recommend carrying EX-US health insurance, which is very low cost monthly, and covers procedures overseas where healthcare costs are much lower.

          Finally, from your cited article:
          “Cancer is primarily a disease of old age, with more than 60% of all cases diagnosed in people aged over 65,” notes Prof. Sasieni. “If people live long enough then most will get cancer at some point.”

          If you retire at 33, 10 years later you have +70% portfolio balance (1.7M net worth), I would say that you are in a much stronger position than the average person who stays at their job with insurance.

          1. “my point is that ACA/Obamacare plans keep monthly costs low with comparable coverage to many working American’s employer provided insurance.”
            This is the point. The monthly costs CAN be low, but usually if you don’t have ANY serious medical needs, and whether you’re working or not. I WISH my monthly costs were low. And just so you know, I’m 47 (tomorrow), workout regularly, eat healthier than most Americans, and have decent genes, but I still have to shell out thousands per year for things that aren’t covered by insurance.

            1. Allison –

              I appreciate the clarification.

              All of that said, this would just increase your annual expenses and, therefore, adjust your FIRE number accordingly.

              If you know that your healthcare costs are thousands of dollars per year, and this isn’t artificially low due to employer subsidies, then it is no different than living in a high cost of living area and desiring to stay there post retirement, in the sense that it is a cost that you need to be prepared to cover moving forward.

              I am genuinely glad you take care of yourself, so you can properly enjoy the fruits of your labor in life!

              I am also American, and the equalizer here is: My rent is 30% less than Kristy and Bryce’s, but that entire delta is accounted for in health expenses, so in my mind it’s a wash, and is simple as understanding your expenses.

              I still consider $500/month for health care costs a minor expense, but that may be a perspective difference, which is a fair criticism/challenge.

      3. Got cancer at 35 with no genetic reason and no family history and every single doctor, nurse and other medical practitioner said to me when they looked at my blood work “wow, you are so totally healthy!” Yea, except I’m here with cancer. Thankfully I work at an amazing company with amazing health insurance, but it was over 2 years (started in October and was finished in Feb, so with 2 max out of pockets, it cost me “only” $20k USD. Also thankfully, I was totally able to pay since I save a lot. The bills my insurance had to pay was in the high 6 figures.

  3. how do you account for income taxes? and im interested in your Home Exchange strategy…do you try to accumulate points? or do you do a reciprocal swap? our house is listed on Home Exchange and mostof our inquiries are from places that i would not travel to…
    thanks!

  4. “But since I went to the travel conference and learned how to travel hack business class flights for free (or nearly free), I don’t need to spend money on that either.”

    – May I ask how do you go about doing this?

  5. It surprising to see no line item for health care/dental care. Is this a function of being young and not doing any preventive maintenance, or is it lumped into “other?”

  6. Can you elaborate on your home exchange experience while in a rental apartment? Is that generally allowed in rentals? I’ve experienced a clear ‘no sublets / no AirBnBing’ in all the rental places all over NYC, but now that I think about it, it didn’t say anything about exchanges/swaps. Our current lease is in a high-rise, the lease states that guests (but not ‘subletters) can stay here without a lease present only if inform ahead of time and only for a very limited amt of time (maybe 2-weeks, tops).

    1. Also interested to hear more on that as the situation is similar in Canadian condos. No rentals/AirBnBs for less than 3 months are allowed. How do you navigate Home Exchange with that rule?

  7. What would I spend an extra $1,036 a month on from my portfolio? Probably something that frees up time, like a house cleaner, handyman, or a plant-based meal prep service.

    Then again I’m working FT and not FIRE yet, so maybe it would be different. Then I might do something like become a lifetime member of the local art museum or helping the parks upgrade their water fountains. I’d also spend it on tipping more. And maybe signing up for weekly composting service.

    1. Excellent comments.

      If you haven’t read it yet, I recommend “Taking Stock” by Jordan Grummet.

      He has an excellent section talking about using your financial independence to reduce time spent doing activities that you don’t enjoy.

      For example, if you enjoy your FT job much more than cleaning, doing chores, and cooking, he would say that your life would be happier by continuing to work FT but paying to outsource as many of these undesirable activities as possible. It is an awesome concept that reframes the typical FI approaches of ultimate frugality.

  8. May I ask how you get cell and internet for two people for 55$ a month?
    If you have a referral code I’ll use it right now.

    Every ISP I’ve considered in Canada starts at about 40$/month for mediocre speed before even considering the cell phone spending, which are at least 30$ per line, again, for mediocre speeds…

    1. I use ‘Public Mobile’ (the discount provider wholly owned by TELUS)
      I pay $32 per month plus tax. (The plan is $35, less $2 for paying online, less $1 for being with them for a year or longer)
      3Gb per month, unlimited Canada wide talk, Unlimited international text

      I’m happy with the plan, it suits my needs, they have other plans with more/less data etc. (ie. 15Gb at 4G speed for $40, etc)
      They occasionally give you bonus data

      VK70Y3 This is a ‘refer a friend’ referral code for $10 off.

      1. Thanks.
        But this will be 32$ x 2 (I assume they each has their own line), plus more for home internet…

        Still way more than 55$ per month.

        1. You can download the VOIP phone app Fongo for phone purposes. I then got the 4 gig $15 + tax = $16.95 data plan for iPad from Fido (it works for an iPhone too, not just iPad). I can text and FaceTime directly as a result with any other Apple product user (I use my email instead of a phone number – yes, that works). For non-Apple users, I use the TextNow app as Fongo is only good for calls (you need to pay for texting which I won’t do.

          And then, you can use Whatsapp with any other WhatsApp user and bypass the messier option I outlined above.

          Ultimately, you only need a data plan and then you’re set. I’ve been doing it this way for about 12-13 years. No issues.

          1. Thanks for the info Dave.

            But still, that’s 16$ x 2 (32$) before an internet provider charge.

            How do you get decent internet in Toronto for 20$? (Their monthly total for both is 55$. Most people pay this much for just one cell plan!)

  9. I’ve seen several people ask the same question about home exchange.
    I could list my large home in a nice neighborhood in a small east coast Canadian city with limited air and zero rail service but I expect very few interested parties.
    Is there a way for me to use this service without having anyone interested in staying at my place?
    Is it time for you to share more about how people who rent or live in less exciting places can use this service?

  10. If I had the extra $1036/month, I would like to open a free karate class.
    I would give priority to children of mothers and children like me as my students.
    I retired early but still don’t have that much extra money so I will keep trying.

  11. Hi, I may have missed something (maybe I need to take Evelyn Wood Speed-Reading!). I didn’t notice health insurance or health care on the list. How do you handle that expense? In my experience as an American living in Taiwan and covered by its National Health Insurance, health care can be: a) a consistent expense (keep paying the monthly premiums), b) a periodic no-biggie expense (trip to a Western or Traditional Chinese Medicine clinic), or c) OH WOW! This is serious! (hospitalization, etc.).

    However, NHI covers a lot + as an American who’s an Army veteran, I could probably access the Veterans Administration, MediCare, etc.

    However, as Canadian digital nomads/FIRE retirees, doesn’t the Canadian equivalent of NHI not cover you overseas? If I missed it on your list, how do you handle my a, b, c scenarios above monetarily from a monthly/periodic/possibly catastrophic event?

    In my case, whenever I leave Taiwan, I buy travelers insurance and also try not to do anything stupid during my trip!

    Best wishes,

    Dan V
    Taipei, Taiwan

      1. Hi Dave, NHI doesn’t cover me overseas, just in Taiwan. I also buy travel insurance when I leave Taiwan (and I do all that I can to not get sick or injured, because I really don’t want the hassle of being away from home where I don’t speak the language and in the hospital).

  12. Congrats on keeping your expenses extremely low. That’s impressive !

    I can’t tell you what I would do if I had extra money to spend. It is entirely up to you. If I was in your situation, I would keep this amount to buy a property later in life. But if that’s not what you want, it makes no sense for me to tell you. Only you can know what you want to do with your money.

    On the math side of things – I’m not sure about the 4% rule – it really does not apply in your case …

    We have seen, in your post last week, that you made around 100K$ net contributions in 2022 (140K$ contribution in portfolio A – 40K$ withdrawal in portfolio B). So, the reality of your situation is that you are still saving money. You are not in a situation where you are withdrawing from your savings .. – ie. the case where the 4% rule apply.

    That would be like someone following a very strict regime of 1000 calories per day from 13pm to 12pm each day (23 hours), without counting 3 bags of chips and 5 hamburgers, because they are during lunch time, and then complaining about the regime not working.

    Except you do the opposite. You are even more frugal than what you had planned and worked even more – at least, in terms of efficiency ! 🙂 – and now you conclude that the 4% rule work very well for retirement …

    That’s just kind of very weird on the math side of things.

    Personally, what I would conclude from your experience is that, you were able to leave your job easily with 1M$, but you probably needed an additional income to be confortable and enjoy life.

    Also, it is very clear from your actual situation (1.8M$ portfolio with 43K$ expenses per year / 2.4% withdrawal rate) that you could have no more income for the rest of your life and be totally fine. So, I would agree when you say you have finally achieve FI.

    Anyway, congrats for controlling your expenses so well, to have the courage to keep investing during these uncertain times and to have so much success with your book and your blog !

    And thanks for sharing all this valuable information with everyone on this blog.

  13. Since you didn’t ask what you would spend it on but what I would spend it on, I would spend that $1000 a month on experiences.

    Right now, that would be horseback riding lessons for me (it’s been really fun and it’s time-sensitive as I can probably only do it for about another 20-30 years). But of course, it could have been Muai Thai or cooking classes or the really, really nice knitting supplies, or violin lessons, or loads of other activities and experiences. Depending on the experience, I could pay to have someone join me, too, so that expense isn’t an issue for them and I get to share the memory.

    I love learning things and trying stuff, and extra money (combined with the time you have freed up) is a powerful combination.

  14. LOL. $1500 rent a month in Canada will get you maybe a 600 sq ft studio apartment. Also frugal eating and clothes . You guys are in your 40’s now ? and living on top of each other like freshman college kids. You need to live a bit!
    We have 2 kids , 2 houses. We just had great holiday times inviting family and friends over for great Christmas and a birthday parties. We spent $400 on each occasion on takeaway . Over $1500 for gifts and presents. Great experiences with skating and swimming days . I’d recommend having kids as the memories are priceless and something to cherish forever

  15. Each of us lives our lives differently and we have our own values.

    After living my FI life for 5+ years now, I enjoy more simple stuffs, taking public transport, coffee shops, backpacking around the world, eat at simple places with good values, hanging out with like-minded people, …

    I notice that some people think that I live this way because I am not truly FI, that I have to forever live frugally to be FI. Even my own sibling once commented that ‘…if he’s really wealthy, he should have bought the latest BMW’. They are all simply wrong.
    None of the people commenting on my lifestyle is FI, and I also observe that FI people don’t comment on others, they’re just too busy having fun themselves.

    Being a Dividend FI-er myself, I have been re-investing the extra that I didn’t use. I don’t care what others think about what a good life is or how to live a life or how much to spend on things/certain activity. I have my own values and as long they don’t hurt others, I’ll live them fully.

    FI has been unbelievably great. Not a single regret. Wholeheartedly recommend it everyone, not by talking, but by example.

    1. Hi Chuck,

      Can you talk more about your Dividend FI situation to help me and others figure out how it worked out for you in terms of numbers ? It would be very interesting to get more insight from you.

      For example :

      Since you reached FI, do you still earn any income in addition to your investment income ? In other words, are you also RE or only FI ?

      What was your expense ratio vs portfolio value when you reached FI ? How did it evolved since then ?

      What’s your age range ? Are you in your 40s, 50s, 60s ?

      Based on your experience of the last five years, are there things you would do differently; any suggestions for future FIRE prospects ?

      Thanks !

      For the BMW, the ultimate flex would be to buy one for 6 months, show it to your sibling, then resell it for a higher price a few months later.

      That’s probably pointless. And your sibling would probably find something else to whine about eventually. But if you want to flex, that the way to go man ! Hehe..

      And the thing is .. you don’t need to do it, but you could probably easily do that. 😉

      1. Manuel, to answer your questions:
        – I am FIRE. Not doing anything to earn anything. Zero. But surprisingly, there are always ‘small money’ coming here and there in different forms: kickbacks from banks, free-lunches from grateful strangers. Opportunities come when you’re not stressed out over it. The power of FIRE.
        – My expense was <3% of my portfolio value when I started my FIRE. It has continued to go down ever since. Just like Millenial-Revolution. From my experience (and others that I have actually met on the road), 4% is a safe number to start FIRE.
        – Just turned 50 a few months ago.

        Suggestion: start FIRE as soon as you can. Just like Millenial-Revolutions. There are many ways to make money down the road, and you'll find ways to make some more if that's what matters to you. FIRE people are not dumb types.
        As we age, our options will be more limited, our interests disappear, and money in the end of our life is as useless as EGP cash before we board our flight leaving Egypt. Unlike returning to Egypt, we cannot return back to our life.

        No need to flex. No need to impress. Already too busy with other better things to do in life.

        1. Thanks for your answers. Your numbers seem very conservative. Starting below 3% was very safe.

          Personally, I don’t have any other income, except I was in finance and trying to leverage my portfolio to earn some additional return over market. I don’t know if that count. If so, that would be pretty hard to get an specific number since it is mixed with my portfolio.

          My expense ratio is also going down over the years. Managing a portfolio while working was super easy. I find it much more stressful while on FIRE. But maybe I will adapt over time.

          I agree with you, no need to impress others. Better to have fun and enjoy our lives !

  16. I think they had mention how they afford the health cost in one of their older post. They have an international health insurance that they pays very low for it every month that covers for the both of them. I think their cost for both of them for the health insurance is less than $100. Health insurance cost just seem to have lower cost if you’re doing FIRE internationally.

    Firecracker and Wanderer, I wonder if you know any health insurance insights for coverage for residentials who wants to remain living in Canada on FIRE? I’ve been looking at options for this and trying to find good health coverage for a couple and cost less than $300 is pretty hard to find. My plans unfortunately can’t include doing FIRE internationally as one partner does not want to travel and live internationally and be away from friends and family for long periods of time….. so sad …

    Canadian’s medical does cover alot of the medical cost for residentials, but optional medical coverage such as dentals and drugs are not included in the Canadian’s medical plans. I’m looking at what options I can have for people who’s under 65 of age, on Fire and would not be working to have the company benefits paying for these health plans.

    Age 65 is great in Canada at least, all these medicals are covered in the Canada’s medical plan for these age.

  17. Thank you for the annual review! So inspiring. Would you consider doing a writeup on hacking business class travel? Thank you!

  18. Just finished reading your book and loved it! A few quick questions about the yield shield portion:

    1) Do mutual funds provide a reliable yield the way ETFs do? (your book uses ETFs in all examples)

    2) Your book says to withdraw your yields every year and then supplement any shortfall with the cash cushion. If you are trying to tax optimize, doesn’t that mean all the yield you are relying on should come from post-tax funds if you want to avoid the 10% early withdrawal penalty? The bulk of my portfolio is in a 401K, but I don’t want to pay 10% so I can’t really include that yield when calculating the cash cushion amount needed right?

    Thanks for providing me this new path to freedom!

  19. Hi FC,

    Appreciate your sharing of the details.

    The post goes to show that FIRE is feasible and can withstand the test of time. As long as one focuses on the desired path, one can live on the generated dividends from the investment portfolio.

    WTK

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