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Financial planning is crucial for achieving a desired lifestyle abroad, enabling a buffer from societal issues, intellectual stimulation, better health options, and opportunities for travel and selective social interactions.
The speaker, Alex, discusses his financial goals and why he returned to the US to build a 'financial fortress' after living abroad. He contrasts his past experiences on a limited budget with his current aspirations for a more comfortable lifestyle, emphasizing the need to plan finances to afford desired experiences rather than forcing a lifestyle to fit a budget.
He outlines five key factors influencing his financial planning: the desire for a barrier from negative societal issues like noise pollution and problematic neighbors, the need for intellectual stimulation found in larger cities with diverse populations and meetups, and the importance of walkability for maintaining an active lifestyle. He notes that these factors often require a higher budget than provincial living.
Further points include the necessity of budgeting for quality amenities, such as well-equipped gyms, and the desire for financial freedom to travel to diverse international destinations, which is crucial for avoiding boredom and stagnation. Finally, he stresses the importance of selectivity in social interactions, which is facilitated by living in areas with better infrastructure and security, allowing for more controlled and positive engagements.
Financial planning for an expat lifestyle involves creating a budget and savings strategy to support your desired life abroad. It's about ensuring you can afford the experiences and comforts that enhance your quality of life, rather than forcing a lifestyle to fit a limited budget.
Creating a buffer involves prioritizing better accommodation and neighborhoods to shield yourself from negative social issues, pollution, and noise. This strategic financial allocation helps ensure a more peaceful and secure living environment abroad.
Living in or near larger cities offers expats better access to healthcare, intellectual stimulation through diverse social circles and meetups, and more opportunities for personal growth. These urban environments often provide the infrastructure needed for a higher quality of life.
To avoid boredom, allocate funds for travel to diverse locations to maintain excitement and prevent routine stagnation. Experiencing new environments is crucial for long-term satisfaction and personal fulfillment while living abroad.
Yes, walkability is important for expats as it facilitates an active lifestyle, contributing to physical and mental well-being. Choosing residential areas that support daily exercise is a key factor in maintaining health and enjoying your expat life.
Selectivity in social interactions is facilitated by living in areas with better infrastructure and security. This naturally filters out unwanted solicitations and allows for more controlled and positive engagements with others.
One commenter shared that a budget of $5,000 per month provided the lifestyle Alex described, which includes walkability, good healthcare, and interesting activities. This budget is for a specific type of comfortable living, not just the most economical option. It's noted that living for less is possible, but may not align with the desired quality of life.
Money matters because it directly impacts the range of choices available for housing, social interactions, and access to amenities. A higher budget allows for a 'barrier' against negative societal issues like pollution and undesirable neighbors, and facilitates access to intellectual stimulation and quality facilities. Without sufficient funds, options can be limited, potentially leading to a smaller world and less fulfilling experiences.
Larger cities offer better access to healthcare, intellectual stimulation through diverse populations and meetups, and more opportunities for personal growth. They often provide better infrastructure, security, and walkability, which contribute to a higher quality of life. These factors typically require a higher budget compared to living in more provincial areas.
To avoid stagnation, it's important to allocate funds for travel to diverse international destinations. This variety is crucial for maintaining excitement and preventing boredom. Experiencing different cultures and environments helps to keep life feeling fresh and engaging.
While living cheaply can save money, it may come at the cost of motivation, social quality, convenience, health, and mental stimulation. For individuals who are curious, active, and seeking growth, the environment significantly matters. Money can remove friction by allowing one to avoid bad situations and choose surroundings that feel more alive.
0:02 Hey, YouTube. Alex here, and in today's video, I want to talk about why I'm targeting a certain level financially, why I came back to the US, and how better understanding wealth and the privileges that wealth can provide will impact my desired outcome.
0:21 So, for those who don't know, this is your first time watching this channel, my name is Alex. I lived in Southeast Asia for a couple of years. Came back about a year ago to continue to build my financial fortress.
0:36 When I was younger, I did the backpacker thing. I lived in Latin America for about 6 months. I had multiple trips to Southeast Asia, and enjoyed a comfortable lifestyle, but with a lot of movement. Didn't really settle down until my multi-year trip.
0:58 And on my multi-year trip, I was on a more finite budget. I'd been laid off from a tech job, and while I saved a substantial amount of that money, I did not work in tech for very long. So, my finances were limited in that certainly impacted my experience, as many people were quick to tell me.
1:19 And I thought, "Okay, well, I could stay here and continue to eke out a life on a very modest budget, or I could figure out how do I want to live, and what is that going to cost me?" Because I encountered a lot of expats in Southeast Asia on a limited budget who were forcing their lifestyle to fit their budget, as opposed to the other way around.
1:47 Now, of course, we all have financial limitations. We all have finite budgets, but I thought, "What are some things that I'd like to do differently next time? And how can I plan to afford that? And what does that look like? What am I seeking out as far as the comfort of wealth compared to my last run?
2:13 And I just think about some of the men that I knew growing up that built substantial wealth and were able to live a more comfortable lifestyle. What did that look like? So, let's go ahead and get into it.
2:27 The first factor is that I want a barrier between me and the general public. And people, for some reason, they understand this in the United States, but if you say it about another country, it is looked at as rude, or if you don't like it, go home, or I hang out with the locals.
2:48 All these excuses, apologetics. In most countries, there are various social ills, particularly in countries with economic problems, most expats are moving to countries with serious economic issues. And so, there tends to be issues that a lot of us, if we had the choice, and we were being honest, we would not want to be exposed to these.
3:14 Noise pollution is a big one. I do not want to be in a situation that I was in in the Philippines, where I had a neighbor, he had a dog chained up in his front yard. The dog was severely neglected. It was very unfortunate. It was very unhappy.
3:37 I would regularly see his wife with a shiner. This is not the type of person I want to be friends with. Oh, everybody's so nice. Well, this guy was probably not very nice. Now, he was the exception in that neighborhood.
3:56 That neighborhood had a lot of successful people and I overall, except for his presence, really enjoyed living there. But, if I had a choice between that apartment building and another one, say down the road, uh without that kind of neighbor, of course, I'm going to choose the latter one.
4:21 And if people are being honest, most Americans would agree. Uh I they don't want to be exposed to that type of behavior. You know, there's other examples as well.
4:34 I found that on a limited budget, when you're trying to figure out what sort of activities you can do, your place that you're living is not the best, then socializing is going to be a top priority. Now, to be fair, in the US, socializing not easy to do.
5:00 So, that was something I enjoyed. After a while, you realize familiarity can breed contempt. You spend so much time with certain people, you go from liking them to getting tired of them.
5:13 And there were guys, too, that I thought I got along with great because you're trauma bonding, you're sharing all these terrible things that have happened to you in the West for you to end up living over there. And the bonds were kind of shaky.
5:27 Here in the West, uh some of my friends I've been friends with since I was a little kid. So, those friendships aren't really going away anytime soon.
5:35 In a transient city or a place where people are moving in and out all the time, you meet somebody and you think, "Oh, wow. I'll be friends with this person forever." But, then you realize, "You know what? I don't know if I really like this person.
5:49 So, having a nicer place to live, not feeling like I'm being forced to go out a lot to get away from the apartment, that would be really nice. That's something I want to budget for is nicer accommodation. Not necessarily a lot more space, but just a better location, better neighbors.
6:09 Something I noticed in Dumaguete is I started to have this fishbowl feeling where if you're on a limited budget and you're trying to do things that you can't do as much back home, the city starts to feel very small.
6:25 I personally realized, this is my next point, I don't want to live in the province. I talked to quite a few Filipinos from Manila about how I was living in Dumaguete City and they explained to me, "Yeah, it's more like Dumaguete province that they felt like there are really three, maybe five or seven, depending on how you count, cities in the Philippines.
6:50 Of course, Manila, Cebu, Davao. It's not really accurate to call Dumaguete a city. Now, when it comes to living in a city, it costs money. It costs more money to live in Manila, Cebu, Davao.
7:07 Just at a baseline, your rent is going to be more expensive, your dining is going to be more costly, your transportation may or may not be more, kind of depends on how much you want to get around the city, but certainly if you want to use that as a home base to travel other countries, it's not going to be cheap.
7:24 Now, I'm not here to crap on Dumaguete. I think there's a lot of guys that like the single-family home living. They like having a more of a tight-knit community. They don't want to deal with big city traffic or noise, that kind of thing.
7:40 There's nothing wrong with that. I'm not condescending that, but for me personally, better understanding how I want to live, how I want to uh do things, I want to be at least on the edge of a larger city.
7:56 If for nothing else, healthcare is a big reason for that. I encountered numerous guys in smaller provincial areas that I've lived that dealt with serious health issues that were exacerbated by misdiagnosis, by lack of medication.
8:18 Um these issues, if you're in a big city, you can get a second opinion. You can go to a different pharmacy very easily. Some cases, you know, some blocks will have two pharmacies. When you're talking about healthcare, which is top of mind for me, I want those options that exist in a city.
8:37 I don't want to be in a position where I'm hoping and praying that things just work out. I want to also be proactive and make sure that I'm set up for success. So, that's going to be a big bump in my budget is realizing, "Hey, yeah, you can exist in a provincial area on a thousand a month, but if you want to actually be comfortable in a city, we're talking more like a 2,000-plus type of budget.
9:15 My next point is that I want to be around intellectually stimulating conversations. And I realized that not everywhere abroad is equivalent. With some people, there's a limited range of topics. There's a finite number of things that they are comfortable talking about, and there's nothing wrong with that, right?
9:38 We all have our scope of interest, what we're into, what we find to be interesting. I just find that in bigger cities, you have more mid to high-range options. You can go and meet people that are, say, engineers or lawyers or doctors more easily than you can in smaller towns.
10:06 You have meetup.com where people who are into tech will go and meet up at a certain location, and you can really talk about these advanced topics. Where I felt like in some of the places I've lived, I was having to call back home to reach out to friends who work in tech or healthcare or finance to delve into some of these topics that I find interesting, because in some small towns, there's this willful ignorant attitude where some people feel insecure when you want to talk about something that they're not familiar with.
10:46 They don't understand anything about finance or healthcare or tech, so they don't want to talk about it, and they will start making fun of you because they feel insecure that you understand something or know about something that they don't understand.
11:05 I don't think this is everybody. I think there are some sharp guys in provincial areas, but it's something that I noticed come up time and time again where people would say, "Oh, yeah, that's interesting. Well, anyway, let me tell you about myself." And then you get decades of living the American grind, which isn't that interesting to me because we all live that here.
11:27 You notice I don't try to talk much about my work because because I just don't think that's the most interesting thing that a lot of people want to hear about. Additionally, I found in some of these places being retirement destinations, people are really thinking that critically.
11:45 You don't have to think that critically. Life is easy. You walk down to the coffee shop, you get breakfast, you meet up some friends for lunch, maybe you film a video, but you're not really having to think like you are in the West.
12:00 In the West, we're constantly being pressured to think at work. Our supervisors, bosses are asking us, "What about this? Why isn't this done? Do this different." That kind of thing. You're constantly being pressured to perform.
12:17 But, when you're in a retirement situation and you don't go out of your way to seek out intellectually challenging tasks, pursuits, then you tend to kind of stagnate intellectually. You tend to atrophy.
12:36 Intellectually, you tend to atrophy where you just don't feel that pressure to grow your thinking. To have access to these kinds of coffee shops, meetups, etc., you've got to be in a decent-sized city. And that's where I didn't have the budget for that.
12:55 So, when I return, that's what I want. There's nothing wrong with not wanting that, but I'm only sharing what I want. I'm not going to sit here and just tell people, 'Oh, I want what you want.'
13:09 The next factor I want is walkability. If you haven't noticed, I gained weight since I came back here to the US, and part of that is that I went from in Dumaguete, minimum 10,000 steps a day, often 15,000 steps per day. And here, there's not really a lot of options for that.
13:30 Unless you're in New York or the Bay Area, maybe West LA, parts of Seattle, most of the US is not very walkable. It's not time-efficient to walk, and most people don't have time to walk after work. Most people are too tired to walk.
13:54 Something I loved about Dumaguete was that I could walk all over town. The infrastructure was decent enough, not perfect, but decent enough that I could walk from my apartment all the way to Robinsons Mall or all the way to the Boulevard. I could walk to the stadium, and that helped me to moderate my weight.
14:21 Getting that much exercise, it takes a fair amount of time. You're walking that many steps, you're walking for a couple of hours a day. It also helped me to stretch my legs. I was enjoying the sun, I was enjoying the street scenes.
14:38 You always see interesting things on the street when you're walking that much, but that's not everywhere. In a provincial area, then there's going to be not much of that. Where if you're in a sizable city, and you elect to get an apartment in a walkable neighborhood, you can get your 10,000 steps in.
14:58 I remember when I got to Makati to stay in an Airbnb, the host showed me how I could walk basically almost all the way to BGC through the malls, and so I got a ton of steps in in Makati. And it's something I was shocked about because a lot of expats, you talk to them who don't live in the big cities, 'Oh, I could never live in Makati. Oh, it's it's so bad. Oh, it's so crowded.'
15:26 I loved it. I loved being able to walk. I loved being able to step into a 7-Eleven to grab a cold beverage. I loved having that air conditioning because the Philippines can get quite hot.
15:41 But, very similarly, there are parts of Bangkok that are very walkable, very easy to walk from point A to point B, and you see a lot of interesting things on the street. But, you've got to have money for that.
15:54 If you want to live in a walkable part of Bangkok or Manila, you're going to pay. It's going to be more than what you'll pay in a provincial area. And so, I realized if I want that outlet, then I need to budget not only for an apartment in a walkable area, but also for a gym membership, to a nice gym.
16:19 There are cheap gyms, and you tend to get what you pay for. I went to one in Vietnam, no air conditioning, no air filter, no cover from the outside street. Now, that gym was pretty cheap, like 12 bucks a month, but I also paid for a $60 a month gym membership in Bangkok.
16:41 They had an air filter, they had air conditioning, it was multi-leveled, you had Wi-Fi, it came with all kinds of nice amenities that the cheaper gym did not have.
16:53 Some of this might be redundant for some people. Let me know what you think down below. Is this just obvious? It wasn't obvious to me, but now I'm understanding why it could be valuable to be better prepared financially.
17:12 What I didn't really understand was money can help buffer you from society. The less money you have, the more you have to deal with society, whether it be at work or at home, etc. You have more money, you live in a nicer place, you have more choice of where you want to live. You can vacation.
17:36 Anyway, let's move on to the next point. The next point is that I want to know if money when I retire to occasionally travel.
17:43 And more specifically, I want to be able to occasionally travel to somewhere very different. Not the next island over, not condescending that. Once again, some people find it really incredible to do a very basic trip.
18:00 If you've never been off your island, then of course going to the next island is going to be mind-blowing. But for me, having traveled a lot, then it takes a bit more to get me going, if I have to put it that way.
18:20 It takes more for me to feel stimulated, to get excited about travel. I've traveled to about 20 different countries, lived in about five, depending on how you count. And so for me to go from one mountain to another mountain or one beach to another beach, it just isn't that exciting.
18:44 It's not a big enough of a difference or a variety for me to feel something big. So, what I want to be able to do is maybe once a year, maybe a couple times a year, I go to a neighboring country or I go to a different region. And that costs money.
19:04 I found that some of the frustration from some of the guys I encountered in Dumaguete specifically was whether for financial reasons or for health reasons, but I think it was primarily financial. They were in that fishbowl. They could not just get on a plane and go somewhere else.
19:25 They had a fixed income and going to even Thailand was off the table. If you don't enjoy travel, it doesn't make sense to spend money on it. But for me, I enjoy travel. I enjoy going to different countries. I enjoy meeting new people, experiencing new cultures.
19:46 I find it fascinating and engaging. And so, I realized, man, you know, some of what I'm dealing with here is bored or frustrated guys that they may have imagined their lifestyle being one of a world traveler, and really they're in Groundhog Day.
20:05 Because of budget limitations, they're living the same day in the same city for years and years on end, when they imagine themselves, you know, trekking through jungles and riding motorbikes all over the country. But because hotels have gotten more expensive, gas has gotten more expensive, really everything has gotten a lot more expensive, they're relegated to just, well, I go to the mall, I go to the coffee shop, I go home, rinse, repeat.
20:37 That's not necessarily what I'm looking for. The fifth and final point is I want to be more selective about who I interact with. I realized that when you're on that limited budget, it can be a reflection of low standards.
20:52 And when you have low standards, you're going to deal with more difficult people, more difficult situations, and you're not going to be able to buffer yourself as much. I've found that when you are in a larger city that the cost of living and the infrastructure has a better design to buffer you from the outside world.
21:21 So, here I'm in a small town. At least once a week, we get somebody knocking at the door trying to sell something. And I don't want that. Whatever they're selling, I'm not interested in it. Neither are my roommates.
21:32 And we have not bought a single thing from them in years of living here. Uh, because everything can be purchased from somebody else without a middleman. I don't need to buy meat from a door-to-door salesman. I don't need to buy lawn care services. I don't need to buy whatever it is that they're offering. I don't need it.
21:56 So, if I'm in a bigger city like in a condo, let's say, an IT park, well, there's security guards. There's an external door and an internal door. There's a gate potentially. There's a lot of barriers between you and the outside world.
22:15 Additionally, you want to go to a coffee shop, it costs a minimum of 600 a month to live in that neighborhood versus say 200 a month. Then you're just going to get a different caliber of person.
22:32 I dealt with some guys who they might have enjoyed living in a bigger city if they had the budget. But because they didn't, they had to spend a lot of time just sitting around. And I think that's fine when you hit a certain age or if that's really what you want.
22:54 But I do think expats have to ask themselves, am I just sitting around because of a lack of energy? Or do I have the energy to go and do something different than this, but not financially prepared to do something different than this?
23:10 So, that was just something I noticed in Dumaguete is I think some of the drama is a lot of guys having far too much unstructured time. Where if you're a more successful expat, you've got business interests, you're running a business, you have consulting gigs, you're engaged, you have a set structure or pattern to your day.
23:37 Where I felt like in Dumaguete, there's a lot of guys that go from having a lot going on to not having anything going on. And that's where you see some of the conflict or frustration.
23:53 A lot of people, myself included, I speak from personal experience here, when they have too much free time, it doesn't go well. So, I want to be set up to where I can move on to the next thing I want to accomplish when I retire.
24:08 So, I hope these five have been informative or interesting. Let me know what you think down below. Are these things that you budget for? Are these things you had in mind when you decided you want to retire abroad?
24:20 I don't think there's anything wrong with doing the opposite of any of these things, but I'm not going to sit here and lie to people and tell people just what they want to hear just to make people feel good. I'm going to share how I want to do things and it may be different than the way you want to do things, but we're not the same.
24:41 So, but we're not the same person. We don't have the same way we want to do things and that's okay. So, anyway, like if you enjoyed this and subscribe if you want to see more content like this and we'll see you soon. Bye-bye.
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