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Retirement

How to retire in your 30s and travel the world

April 21st, 2015 by

Start with making these three budget cuts

 
 
 

If you've ever dreamed of taking off work - oh, say, permanently - to travel the globe with the cherie of your life, you might want to take a page out of this couple's bankbook.

According to Yahoo, couple Jeremy and Winnie were 38 and 33 respectively when they welcomed retirement with unsurprisingly open arms - and it only took a few years to get there.

Jeremy had been working toward paying down his debts through a job with Microsoft. Once he was near debt-free, he started putting away as much of his income as he could. After meeting Winnie at a conference in Taiwan, the two plotted to retire early (and together - awwwh!) by putting away as much as 70 percent of their collective income until they could afford to do it.

3 biggest budget holes 

Jeremy sold his house and began renting, commuted by bicycle rather than car, and began buying most of the couple's groceries at the local farmer's market.

"Since the biggest part of your income is housing, transportation and food, those three things were cut really aggressively, so our monthly spend was less than $2,000 a month at the end," he told Forbes. 

Not only do housing, transportation and food account for the largest expenses in the average household budget - but they're showing little sign of slowing down anytime soon. 

By the numbers

According to a recent report by Statistics Canada, Canadians allotted an average of 28 percent of their household income toward shelter costs, including property taxes and utilities. Total shelter spending rose 3.6 percent from 2012 to a whopping $16,387. 

Meanwhile, transportation guzzled another 20.6 percent of the average household's income, with average cost rising 7.4 percent from 2012 to $12,041. Food swallowed up a further 13.6 percent, with average spending at grocery stores and restaurants up 2.7 percent and 3.3 percent respectively to a total of $7,980.

Pushing through

Altogether, the average Canadian household is doling out $36,408 on these three expenses. Jeremy and Winnie managed to bring that down to $24,000. Meanwhile, Jeremy's salary at Microsoft only rose higher. In the 12 years he worked there, his annual income soared from $85,000 to $140,000. The financial crisis sucked $400,000 from their net worth on paper, but the strategy that got Jeremy to where he was at that point, was the same strategy that would carry him through the economic turmoil: Persistence.

Two years later - and flush with a whole new set of stocks and the same old financial principals they'd learned to live on - Jeremy and Winnie had managed to stash away a cool $1 million to fund their worldly new lifestyle. 

Adventure awaits

The two have budgeted for $40,000 per year in living expenses and now live in Taiwan, where they're expecting a new little bundle to join them on their travels.

Let's hope those diapers fit in the travel bag.

 
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May 26 2017 6:11am
 
 
 
 

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