5 Lessons from the Past 3 Weeks of Traveling in Paris

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Lessons from Travel in ParisOne of the things I love most about travel is stepping into an environment that shatters your assumptions and norms, forcing you to re-consider your life.

Here are five things I’ve learned during the last 3 weeks in Paris:

#1: Own REAL Things.

Last week I walked past an umbrella repair shop. Let’s think about that for a second: an umbrella repair shop. Can you imagine owning an umbrella that’s so good it merits repair?

Probably not. Most of our possessions are disposable junk. If something breaks, we throw it away and buy another one. We replace rather than repair.

So Lesson #1: Own real things. Don’t equate “frugality” with buying the cheapest, plastic, mass-produced piece of crap on the Walmart clearance rack. Sure, it’s cheap, but it’s also garbage. It won’t stand the test of time.

It’s better — in my view — to own and use things that are made from solid materials, like stone and wood and quality fibers. Things that have craftsmanship and durability. Things that will stand the test of time.

When the soles of your shoes wear down, re-sole them. When your umbrella rips, stitch it. When you lose weight, tailor your clothes. Don’t fill your life with disposable junk. Your possessions should be fewer, but better.

#2: “New” Does Not Equal “Better”

This goes hand-in-hand with the previous point: “New” does not equal “better” if something is well-made.

People in the U.S. tend to prefer “new construction” homes. That’s because most American homes are disposable — nothing more than drywall on a slab foundation. They weren’t built to last. After only 30 or 40 years, they start falling apart. Isn’t something wrong with that picture?

In Europe, the older homes have stood for centuries. And barring any massive war or natural disaster, they will stand for centuries more. They were built to last.

Lesson #2: To whatever degree is possible within your own life, build things to last.

  • If you’re launching your own business, focus on creating a legacy and succession, not just on next quarter’s revenues.
  • If you write, create content that leaves a legacy, not just article-spun crap that’s geared for search engines.
  • If you’re buying a home, look for something that’s sturdy and well-built. A “real house” never has a true owner, only a series of caretakers.

#3: Resources Are Precious

This observation literally stopped me in my tracks: Pizza Hut makes deliveries on scooters. (Check out the photo at the top of this post).

That makes total sense, when you think about it. Why do you need a whole car to deliver a pizza, when a scooter will do? If you’re delivering a few pizza boxes, you don’t need to lug your entire empty backseat and trunk along for the ride.

So Lesson #3: Resources are precious, so don’t waste any more than you need. Money, gasoline, and even air space are valuable commodities.

#4: Live Small & Efficient

Compared to a typical American home, my home is small. I don’t have a garage, dining room, hallway closet, or a laundry room.

Our washer/dryer are in the kitchen. We eat around the kitchen island. We park our cars on the street, and we store Will’s tools and my gardening supplies in a corner of the living room.

As a result, many frugal tactics that I read simply don’t work for me.

  • “Buy in bulk.” Really? Where on earth am I supposed to store 96 rolls of toilet paper?
  • “Host a garage sale.” Really? Where am I supposed to store all that junk in the meantime?

Then I went to Eric’s apartment in Paris. Eric and his girlfriend are both in their late 20s / early 30s. They work for a major international company. Their space is fairly typical for a young professional couple. It’s 269 square feet (25 square meters).

Suddenly, my inability to store bulk items from CostCo didn’t seem so bad. Small is relative. And I could minimize more, curate my possessions, find more efficient storage solutions.

Lesson #4: Live small. This goes hand-in-hand with not wasting resources. Maintaining a large house costs a lot of money and energy. Focus on living more efficiently, rather than living largely.

#5: If You Have Space, Use It

On the flip side, our “ample space” allows us to maintain a do-it-yourself lifestyle. When the dishwasher breaks, we can grab tools (from our living room) to fix it. When our gutters get clogged, we climb a ladder to clean it. And although I store gardening supplies in my living room, I’m able to grow fresh tomatoes, peppers and broccoli throughout the summer.

When space is truly small — like 269 sq. ft. — that DIY-culture just isn’t possible. You’re not going to paint your own walls; where would you store the trays, cans and rollers when you’re finished? You’re not going to grow your own fresh vegetables and herbs; at most, you’ll have space for a few container-grown plants.

If you choose to occupy a larger space, utilize it. You have an opportunity to fix your own appliances, grow your own produce, to craft your own beer. Use it.





“I Don’t Want to Be Ordinary” — Can This Woman Escape the Ordinary?

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A Reader Says: I Don't Want to Be OrdinaryHere’s a recent reader question that grabbed my heart. One reader said:

“I am a single woman with children who believes I can live a great life traveling and making life grand, in spite of the statistics out there. Do you think its possible? Can you offer some saving/investing tips?”

I’m so glad you wrote to me. YES, I think it’s possible to live any life that you desire. I absolutely, completely, 100 percent believe that.

Ignore the statistics. You’re not a stat. You’re an outlier. The upper end of the bell curve. You’re unique.

How do I know that? Because you dared to ask. You wrote to me — a complete stranger — for advice. Most people wouldn’t do that. Most people would sit on the couch watching American Idol reruns.

Most people — regardless of their age, income, family or financial situation — don’t have the courage to dream big. Most people spend the whole day saying self-defeating things like:

  • “I’ll never be rich.”
  • “I could never afford that.”
  • “People like me don’t get to do things like that.”
  • “Good for her, she gets to galavant and have fun, but I have to (fill-in-the-blank with crummy obligation).”

And you know what? Whether you think you can, or think you can’t — either way, you’re right. Life is completely what you make it. Especially if you live in a free, first-world country. Then there’s really nothing stopping you.

Regarding the second half of your question — do I have any saving or investing advice? Of course I do. But I won’t tell you to clip coupons (ugghh) or invest in index funds (though I love ’em!), because those are tactics, and tactical maneuvers are secondary.

The best advice I can give anyone is to align your spending with your values and priorities.

Almost every financial stress that I see is the result of people spending in a way that’s misaligned with their priorities. It leads to staggering debt, bankrupt college funds, meager retirements, and — perhaps most terrifying of all — cubicle jobs. Eek!

But when you can kick back and say, “The most critical thing is food, water, medicine and safety. Let me make sure I can pay for that, not just today but years into the future. And after that, my real dream is …”

That’s the moment when driving an old car no longer feels like a sacrifice. Would you rather drive an Audi or quit your crummy cubicle job? Would you rather have granite countertops, or the flexibility to take a major career risk?

(By the way, I realize I might sound like I’m anti-luxury items. I’m not. I’m pro-anything that’s a conscious priority. And I’m anti-anything that’s not.)

In my own experience:

When I was 22, I wanted to travel more than anything else in the world. I wanted it so badly I could taste it. I thought about it constantly. And I aligned my spending with this top value.

That meant that I lived incredibly frugally. I lived in a tiny, tiny studio apartment (I could reach the kitchen sink from the bed — I’m not kidding.) I drove a car that was older than me. I wore thrift-store clothes. And I saved almost $30,000, which allowed me to travel the world nonstop for more than two years.

But another example:

Right now, my priorities have shifted. I don’t want to do a two-year round-the-world trip anymore. I want to build streams of passive income — so that my money can buy time. I want to live in a comfortable home, work on a MacBook, and enjoy a gym membership — even if it comes at the expense of travel. So my spending has shifted to align with my new priorities.

That’s what it’s really all about. All the details that financial bloggers talk about — insurance premiums, coupons, the price of gas — those are all just details. That’s minutia.

Step back and take the big-picture view: is your money flowing in the same direction as your values and priorities? If so, you’re in the right place. If not, make a change.

It’s as simple as that.





Two Critical Things You Should Know Before You Invest in Real Estate

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Note from Paula: This is a guest post from my friend Brandon Turner, a guy who shares my love for real estate, traveling and cats — not necessarily in that order.

Brandon used to write a blog called Real Estate in Your Twenties, which appealed to me for obvious reasons. These days he lurks around the corners of Bigger Pockets. He’ll introduce himself at the end of this post. Until then — take it away, Brandon!

The Only Two Things You Need To Know To Invest in Real Estate

The Only Two Things You Need To Know To Invest in Real Estate

I’m not a big fan of file cabinets right now.

Last month I bought a new file cabinet for my office. In an effort to make my office look more “home-y” I sprung for the nicer wood cabinet that resembles a dresser you might store your clothes in. Real fancy. I picked it out at my local Staples and told the associate I’d take it.

“You’re in luck! We’ve got one left. I’ll go grab it,” the associate said.

He returns a few moments later with a box.

Not a file cabinet. A box. That easily weighed over 100lbs.

“This is how we keep our prices so low! You get to put it together yourself and save! But don’t worry – there are instructions!”

I’m a fairly handy guy, so I buy the box and take it home. I know how to use a screw gun – I can handle it. After all, he said there were instructions.

The “instructions” ended up being 40 pages of pictures with no words. Just terribly drawn pictures of a cartoon man putting together a cartoon file cabinet.

Two hours later, the cabinet was put together and finally resembled a nice piece of furniture. However – several key pieces of the “guts” were missing, requiring me to fill out an online order form to get the new pieces. Two weeks later they arrived … and were the wrong kind. I’m currently waiting for order number two.

A month into this ordeal, all I have gained is a large file cabinet that cannot hold files. The only one getting any positive use of this thing is my cat, who has taken up residence on top.

Sometimes, life is just so complicated. From the box, to the manual, to the missing parts – it’s been so frickin’ complicated.

Perhaps you are wondering where I’m going with this thing. Trust me – I have a point.

In a world where everything is so complicated, there is one thing that doesn’t need to be: real estate investing.

I know – you think I’m crazy. Perhaps real estate investing seems as complicated to you as that file cabinet did for me, or maybe worse. However, the basics of real estate investing are actually so simple that even a child can understand it. This post is going to quickly break the whole industry apart for you into only two things you need to know.

A niche, and a strategy.

Allow me to explain.

Your Real Estate Niche

The first thing you need to determine for yourself when investing in real estate is your niche. Your niche is the type of property you want to invest in. There are many different kinds of property and like beer, paint, modes of transportation or clothing style – no “one niche” is right for everyone. That’s what makes real estate so fun – your personality gets to define your niche. Let me explain some of the more “popular” niches to invest in:

  • Single Family Houses
    No need to explain this one, but a single family home is the most common type of real estate investment. This could include a nice house in the ‘burbs, an inner city house, a condo, or any other type of real estate in which just one family lives.
  • Small Multifamily Housing
    This would include duplexes, triplexes, and quads (properties with 2, 3, or 4 units.) These properties are still considered “residential” in a lender’s eyes – making loans much easier to get.
  • Large Multifamily Housing
    Anything five units or larger is part of the “commercial” lending world and can range from a simple 5-plex all the way up to hundreds of units.
  • Commercial Real Estate
    Commercial real estate involves renting property to businesses. This could be an office building, warehouse, a shopping mall, a coffee shop, or any other kind of business.
  • Notes
    Perhaps you don’t want a physical piece of property at all. Investing in “notes” involved the buying and selling of loans. Although many don’t know it, notes can be invested in using the same strategies as actual properties. We’ll get to strategies in a second.
  • REITS
    Another method of investing without actually dealing with specific properties, the REIT (Real Estate Investment Trust) is like a “mutual fund” for real estate. Essentially, a multitude of investors pool their money into a fund to buy large pieces of real estate and share in the profits.

Each of these niches also have sub niches you can choose to explore as well. For example, you may want to invest in a single family home, but you can narrow down your niche even further into mobile homes or McMansions. The choice is yours!

Choosing Your Strategy

By now, perhaps you have an idea of the kind of property you want to get involved with. Maybe small multifamily properties really float your boat (it sure floats mine!) Or maybe you like the idea of investing in “notes.” Whatever choice – it’s not enough to simply buy something. How are you going to make money in this niche? This is why the second thing you need to decide on is your strategy.

Your strategy is the method you use to turn your niche into wealth. While not every niche will work with every strategy, you’ll find that most do. Investing in real estate simply comes down to picking a niche and then picking a strategy. It really is that simple. The following is a list of just a few of the more common strategies you can use:

Wholesaling

One of the more popular ways to enter the real estate investment business, wholesalers are the “scouts” of the industry, who seek to find deals for other investors and make money for finding those deals. In a typical wholesale deal, a wholesaler will find a great deal, put the property under legal contract, and then sell that contract.

For example, Bob the Wholesaler finds a small duplex that the owners are looking to sell. He signs a legal contract to buy the property for $100,000 and then finds a local landlord, Susan, who is looking for duplexes. Bob sells that contract to Susan for $10,000 and Susan closes on the duplex. In the end, the seller got what they wanted, Susan got what she wanted, and Bob made a nice profit.

Flipping

If you have cable TV, you probably know about this kind of investing. House flipper seek out great deals (often from wholesalers) and rehab the property, turning an ugly house into a beautiful home that they can sell on the open market to a family.

For example, Julie is a house flipper. She buys a property for $105,000 and hires contractors to put $35,000 worth of labor and material into beautifying the home. She pays another $20,000 in holding costs and transaction fees (insurance, mortgage, staging, seller-paid closing costs, agent commissions, loan origination fees, appraisals, etc.) She sells the home for $190,000 and profits around $30,000.

Buy and Hold

The most traditional of the bunch, a buy-and-hold strategy involves purchasing a property and simply holding onto it for many years. An ideal buy and hold property should produce both monthly cash flow (extra money after all the bills are paid) and appreciation (the value climbs over time).

For example, Jerry buys a small strip mall for $1 million and holds onto it for 30 years, making an solid return on his investment each month. Meanwhile, the loan on the property is paid off and the prices rise over time. Jerry’s retirement is fully funded by the property.

Don’t Over-Complicate Things

Like the instructions that came with my file cabinet, many people seem to complicate the real estate world with manuals, guides, and missing parts. I’m not saying real estate doesn’t have a lot of moving pieces and intricate details. However – the details will come as you get into it – you don’t need to know them all right now.

Don’t let the complications be a barrier to you when considering real estate as a source of income for you and “vehicle” for your investments. As you progress, you can learn more and dive in more deeply, switching between different strategies and niches and even combining different strategies to make even more profit. But don’t worry about that now!

This post was meant to give you a big picture framework for thinking about real estate and how people actually make money doing it. It really does come down to just knowing those two things: your niche and your strategy. Do you know yours? What is your favorite niche and your favorite strategy so far? Why?

Let me know in the comments below!

(I’ll go first: my current favorite niche is large multifamily properties and my current favorite strategy is “buy and hold.” Why? I love the cash flow I’m getting from my my large multifamily properties, which allow me to work how I want, travel when I want, and live the life of my dreams… well, my dreams without a file cabinet anyways!)

My Current Favorite Niche Is: _______________________
My Current Favorite Strategy Is: _____________________
Why? ________________________________________________

Brandon Turner is an active real estate investor and head of community at BiggerPockets.com – the real estate investing social network. He obsesses about real estate and his cats, and likes writing epic blog posts on things like the best way to screen tenants and the best way to rent a property out.

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Real Readers Ask: Traveling & Tenant Screening

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Want to know more about world travel and tenants? Welcome to the latest installment of Real Readers Ask. Today I want to share two questions that AA readers posed last week.

What Did You Do With Your Stuff When You Traveled?

Noelle wrote to say:

“Hi! You’ve inspired me so much with your drive to be “location independent.” I was just curious about one thing: Did you sell your home in order to travel? Or did you have your own place to come home to?”

(Note to New Readers: Noelle is referring to the time I traveled around the world for more than two years, venturing across the Middle East, Asia, Europe and Australia.)

For the sake of saving money, I didn’t have a home … or anything else.

I sold almost everything I owned, including my car and furniture. I sold some stuff for hundreds of dollars, and other things in $20 increments. All the money went towards my travel fund.

Anything I couldn’t sell, I donated to Goodwill or the Humane Society thrift store. The few possessions that remained, like my snowboard, I stored with friends.

I had been renting, so I timed my departure to coincide with the end of my lease. In the span of one week, I quit my job, moved out of my apartment, and flew to Spain with a one-way ticket.

Of course, I knew I’d be traveling for 2+ years. If I had only been going away for 6 months, I would have acted differently.

If I had owned a home, I would have placed a tenant in it and hired a property manager to oversee the building. In fact, I know a woman who has a handful of rentals in Atlanta, but lives in Paris. Her property manager sends her a check every month, which she spends on bicycles and clothes and croissants and whatever else people buy in France. ☺

If you’re a homeowner, and you lived by The One Percent Rule when you bought your house, you’re in a much stronger position to travel than renters are. Renting out your home is the fastest and most surefire way to retire young, travel anywhere, and live free.

How Do You Lead Tenants from “Showing” to “Move-In”?

Trevor, age 31, wrote to say:

“I have two rentals, and my own home. I love reading about real estate investing, but the thing I have the most problem with … (is) getting people from a showing, to tenancy. Could you write about your process? What info do you give them at the showing? What questions do you ask them? What credit/background check service you use?”

I have the same problem. I’ll do a showing for prospective tenants. The potential tenant “oohs” and “ahhhs” about the high ceilings and big backyard. They start mentally placing their furniture throughout the house – “My couch would look great here! I can put my table there!” – which is a fantastic sign.

Then I never hear from them again. They never fill out an application. So what do I do?

Nothing. If they’re not on-the-ball enough to fill out an application, I don’t want them as a tenant.

Besides, if they really wanted to live there, they’d apply.

As for the second part of your question, regarding tenant screening: I use TransUnion MySmartMove as a tenant screening service. It allows you to view their credit score and their criminal history.

(By the way, that is NOT an affiliate link or any kind of paid promotion. That’s just what I genuinely use.)

I also call their current/previous landlord and get a copy of their pay stub. If they live in an apartment building, look up the phone number of the building yourself rather than dialing the number they gave you. Plenty of tenants have their friends pose as a fake “ex-landlord” reference.

Should bad credit nix the applicant? Sometimes.

One of my best tenants had perfect credit except for a foreclosure. The foreclosure tanked his credit score, but I noticed that he paid all his other bills – credit cards, car loans, etc. – on time. His income was almost four times the monthly rent. So despite his low credit score, I let him move in, and he’s been a perfect tenant ever since.

Of course, your results may vary. This is a judgment call. You have to make your own decisions.

Three More Essential Tenant Tips

UPDATE 2/13/2013: One of my readers, Karen, emailed me the following tenant screening tips. I liked these so much that I asked her if I could share them with AA readers:

#1: Peep Their Ride.

The MOST important other thing to do is look inside their car when they come to see the rental. You will see their attitude towards their surroundings. The way they keep the inside of the car is the way they will keep your premises.

If the car is old, but clean as a whistle, they take care of their possessions and will most likely keep your rental the same way. If the car floor is knee-deep in fast food wrappers, soiled baby diapers, garbage, empty beverage cans, discarded clothes, this is how they will keep your home. Their attitude towards their surroundings is poor. They will also most likely refuse to pay for – or even acknowledge – their damages.

#2: Visit Their Home.

If they live in town, visit their home. The way their home is is the way they will keep YOUR place.

How can you see their home? You can drop by to give them information. You can arrange to sign the lease there. (You’ll still have time to back out if you see that they’ve trashed it!)

By visiting their home, you will also find out if they have pets. This will be especially important if your lease specifies “no pets.” (Incidentally I never allow pets, especially dogs. When the tenant’s dog bites someone, YOU will be sued. The tenant will get off scot-free, as they have no assets which can be taken in the judgement.)

Pets also leave fleas, tear up carpets, damage woodwork, bark constantly, and defecate in and out of the house (which irresponsible pet owners don’t clean.) Your insurance company will love you if you don’t take pets, especially large dogs.

#3: Use Google Voice (or an Answering Machine).

I use an answering machine for calls. If the prospective tenant is speaking over the sound of shrieks and howls and commotion — if they sound like they’re calling from the raptor house at the zoo — you most likely will not find them to be good tenants.

One day I heard two calls on the answering machine. One was from a man who said: “Hello, this is Dennis. I’m a heavy equipment operator for XYZ Construction Company and I’ve worked there for 3 years. I work 6 days a week, and I’m gone from 6 AM until 6 PM every day. I have my pay stubs to prove how much I earn. My boss will give me a reference.”

The second call said, “Yo. I needs the place. Welfare gives me some money and I live with my Daddy. He won’t let my homies hang at his place. Welfare says they give me mo money if I has my own place. Then my homies can hang at my pad.”

When you use answering machine, you can pre-screen. You don’t have to bother calling back the tenants that don’t sound like good candidates. (And if they imply that they’ll be using your place as a party pad, paid on the taxpayer dime, they might not be the tenants you want.)

The reader who contributed these comments, Karen, has been a landlord for more than 20 years. Karen says: “At one time I had 54 tenants simultaneously in addition to my regular business, and I have always been a successful owner of rental property.”

What the French Taught Me About Texas

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Flaneur - What the French Taught Me About Texas TravelI’ve been in Austin, Texas for a week; I have another week to go. Several people here, upon discovering that I’m a visitor, have asked me the same question:

“So what do you want to do while you’re here?”

I shrug. I’m up for anything. Most days I pick a neighborhood, stroll around, poke into coffee shops and cafes, and strike up conversations with random people.

Apparently this is rare. Many people think they need to travel with an hour-by-hour itinerary of events. They’ve got plans, maps and agendas that guide them from breakfast ‘til dessert.

If you only have 10 vacation days per year, this strategy makes sense. Losing one day through inefficiency – sleeping late, missing the train – equates to losing 10 percent of your annual time off from work. You feel pressured to fill that unscheduled gap between 10 a.m. and 2 p.m. The clock is ticking.

Unfortunately, this harried pace prevents the spontaneity that creates the most amusing chance encounters. I’m referring to the take-a-side-street, say-yes-to-invites, make-new-friends-in-strange-places spontaneity.

There’s a French word that expresses this idea: “flaneur.” This refers to someone who strolls around, without hurry and without haste, drinking the sights and sounds, ready to experience anything.

American actress and author Cornelia Otis Skinner describes a flaneur as “the deliberately aimless pedestrian, unencumbered by any obligation or sense of urgency, who, being French and therefore frugal, wastes nothing, including his time, which he spends with the leisurely discrimination of a gourmet, savoring the multiple flavors of his city.”

What a beautiful way to live. Frugal with time, yet unhurried.

The French have described the way I want to spend my time in the beautiful state of Texas.

Even if you only have 10 vacation days per year, dare yourself to try it. Resist the urge to jam-pack your days as if you were at a business conference. Stroll aimlessly. Talk to strangers.

Better yet, try it today, in your hometown. Take a side-street. Stroll into an art gallery. Meet someone new. You never know what’s around the corner, even those corners in your own backyard.



P.S. I have heard that some parts of French-speaking Canada use the word “flaneur” to refer to loiterers. That’s NOT the kind of aimless strolling I support.

P.P.S. Please don’t turn the comments section into a Texas vs. France debate. This ain’t the place.

Can You Save Money … By Traveling?

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Most people focus on saving money to travel. But can you save money by traveling?

It sounds counterintuitive, I know. But a hidden truth of travel is that – depending on where you go and what you do – your expenses while traveling can be lower than your expenses at home.

Pocket the difference, and you’ve saved more by traveling than you did by sitting on your couch watching reruns of Friends.
save money by traveling
Let’s examine a hypothetical scenario to see how this plays out.

Adam and Alice, a couple in their early 30’s with no children, decide to spend one month camping in forests across Washington, Oregon and California.

At home in Seattle, their joint expenses are:

Rent: $800/mo
Utilities: $220/mo (gas, electric, cable, internet)
Cell Phones: $80/mo
Gym Membership: $80/mo
Gasoline: $100/mo
Insurance on Two Cars: $100/mo
Groceries: $175/mo
Dining Out and Entertainment: $80/mo
Student Loan repayment: $100/mo

Total: $1,735/mo

Adam and Alice realize they can slash a lot of these costs while they’re on the road.

Here’s their travel cost-of-living:

Rent: $0, after finding a renter to sublet for one month.
Utilities: $0; the sublet renter signs an agreement to pay the utility bills
Cell Phone: $40/mo; they put Alice’s phone plan on hold, since they can rely on just one person’s phone. Long calls to loved ones take place with unlimited night and weekend minutes.
Gym Membership: $0; on hold
Insurance: $50/mo, as they now only need to insure one car. The other car stays parked in a friend’s garage.
Dining Out and Entertainment: $0, as they’ll get all the entertainment they need from the adventure itself
Student Loan Repayment: $100/mo

Of course, they have to take on new expenses too. Gasoline during the road trip will run them $400. They’re planning on camping in national parks and forests, which means they’ll need a tent and camping mat ($100). They can camp for free on grounds managed by the Bureau of Land Management, which are abundant in the Western U.S.

They buy a mini-fridge for their car ($40) which is powered through an inverter that plugs into the cigarette lighter ($30). They also buy a camping stove ($40). These investments mean their grocery bill stays at its normal $175/mo, since they don’t have to dine out while they travel.

Monthly expenses: $765
Equipment cost (tent, stove, etc): $210
Total cost of living for the month: $975

Savings: Their cost-of-living while traveling is $760 less than their cost of living at home.

Is That “Real” Savings?

Are they actually saving? It depends.

If they’re using paid vacation or working remotely from their laptop, then yes, they are saving $760. (Paid vacation is a myth, but that’s a different story.)

If they have passive income that pays their home cost-of-living ($1,735/mo), then yes, they’re saving $760. (Heck, if their passive income pays even $1 more than their travel costs, they’re saving.)

If their income drops to $0 as they travel, then no, they’re not saving … but they’re spending roughly half as much as they do when they’re at home in Seattle.

In other words — the trip isn’t as expensive as people might assume. They’re taking a road trip for one month for less than $1,000.

Which means that when people ask “How could you afford to travel for a month?,” they’re asking the wrong question.