A while ago I was reading Location Independent Living, and I came up with three questions that I had about actually implementing it with a family. Most of these questions probably would arise reading the now-famous Four Hour Work Week, too, but I have yet to read it (read my thoughts on that book here). In my first post, I asked the question “what does that really mean”? In the second, I asked if you could be location-independent with children. Now I’ll answer my final question – what kind of financial situation do you need to be in if you do it?
I’ll start out with the obvious: if you are debt-free, flush with cash and adequately prepared for retirement you’ll be better off than most people, regardless of whether you live on the family estate or you are location-independent. If you have kids, it’s nice to have a little extra for your college education but as I’ve said before I think that’s probably not needed. So what kind of financial situation do you need to be in? Do you need to be able to purchase a new car in each new location? No. Do you need to live in the best part of town? No. Do you need to be able to buy a new set of heirloom china? No.
But to my mind, here’s the kicker, and it’s a big one. You need health care, and as a tourist or traveling worker you’re not first in line for health care, even in countries which provide it as part of the social welfare state. You may not even need insurance; health care costs can be quite low in many countries in comparison to the US, where it’s artificially inflated thanks to our broken system. But you do need it. Most young (or in my case, semi-young) people are sure that they are more or less invincible. While I may get the occasional bug or scraped knee, I don’t plan on serious illness. If I traveled, I wouldn’t, either. I spent years traveling the globe and only came down once with anything more serious than a cold. But the one time I did get seriously ill, I was fortunate to be able to drag myself into a private American clinic rather than suffer the “eh, this syringe has only been used twice” Russian healthcare system. And that’s one serious consideration: if you’re traveling with kids, you’ll inevitably have a virus situation, or an infection, or so on. If you haven’t paid for very comprehensive health insurance (i.e. insurance that covers emergency trips to the US or at least another Western country) you’ll be at the mercy of your local system. And comprehensive health insurance is going to be very, very expensive if you’re a web worker or an independent contractor.
Other than that, though, I’ve always imagined that life as a location independent consultant would be fairly easy on the finances as long as you didn’t have high expectations for your lifestyle. Of course hooking up cable or satellite in a new country once every 3 months would be expensive, but if you’re able to travel with a foot locker or two you’ll only need to pay for accommodations and food – and just like at home you can live expensively or frugally. Once your kids are old enough to manage without formula or baby food, it’s simply a matter of acclimatizing them to local foods. I’ve eaten enough overseas to know that as long as you don’t insist on the organic sheep’s eyeballs you’re not going to spend too much more than you would at home.
So that concludes my three-part thought process. Bubelah and I like to fantasize about lazily traveling the world with our two kids, but my type of work is unfortunately highly specialized towards US companies. That having been said, we think we could manage living overseas with our kids for long periods of time if we both worked hard at web businesses and I homeschooled the kids. That having been said, we’ll probably aim for a more modest goal of spending one long vacation overseas per year – but you never know! Egg me on…
Do I need health insurance abroad? Web MD