Financial independence and travel: Can you have both?

Devin’s article intrigued me enough to reach out to Featured.com and LinkedIn to see what various financial experts and business owners think about this question. Devin herself concluded that “maintaining financial independence while traveling is entirely possible with a proper strategy.”

Certainly, my own experience is that regular travel is quite consistent wiloth at least semi-retirement. In fact, you will note that Devin’s blog includes a couple of photos of Ruth and I that were taken in Malta and Italy, which attempt to portray the idea of combining business with pleasure. 

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Few would dispute that full traditional retirement is entirely compatible with extensive travel; that seems to be the dream of those still employed full time in the work force. But increasingly, the FIRE [Financial Independence Retire Early] movement and/or semi-retirement or early retirement may also be compatible with working at least part-time, often some of it on the road. 

Hence the term “digital nomads,” for those whose encore careers may allow for travelling and working wherever a laptop and internet connection are available. Certainly, running a financial web site like I do, and writing an occasional column like the one you are reading, can be done from just about anywhere.

Our family’s routine of spending six weeks every winter abroad (usually some place different each time) was honed after a similar trip in late 2022 to Malaga, Spain. We replicated that experience last year in the Bahamas and this year, as stated, in Malta. In all cases, we commit to at least one month in one location at an Airbnb; rates are lower when you do that. We look for elevator access and mod cons like a dishwasher, microwave, washer, and dryer, as well as the usual kitchen appliances like toasters and coffee makers. 

As we explain to friends baffled by our choice of staying long periods in one small location, our routine abroad is not all that different from what we do in Canada: we like to walk every day near a body of water (at home it is Lake Ontario), and we try to eat most meals at home. Usually, we find a farmer’s market and/or convenience store that is a short walk from our temporary home. 

As a result, our monthly food expenses aren’t significantly more than they would be at home, although one tends to splurge on restaurants a little more, of course.

Internet facilitates digital nomads

Clearly, the internet is essential to the digital nomad lifestyle. For us, key applications apart from Airbnb are Netflix and YouTube—the latter is useful to find local travel advice from semi-professional travel bloggers, as well as providing music and even a limited amount of news. We don’t rent cars, preferring buses and trains, but if we did, we would no doubt rely on mobile apps like Waze or Google Maps. 

By the deadline for the Featured article, I had received 84 submissions from a variety of financial pros, travel specialists and business owners: too many to summarize in this short column. Sadly, even in the longer space of my website, I had to restrict it to about 25 responses. The vast majority agreed with Devin’s initial premise that travel is indeed compatible with financial independence. As Rex Freiberger of Kibble Facts put it, “The framing of travel as a threat to financial independence is mostly a myth built around the most expensive version of travel.”

Travel does not have to be expensive, agrees Joshua Wahls of Insurance by Heroes: “Business-class flights, five-star hotels, and $40 cocktails at the pool bar are optional. A $500 round-trip flight and a $60 per night Airbnb in a country where your dollar goes three times as far is still travel.” 

Some of the “have your cake and eat it too” ideas submitted include renting recreational vehicles (RVs) for extended travel stretches, and making your home base a maintenance-free travel community, which essentially facilitates a “lock and leave” approach to foreign travel.

I even came across a new term I hadn’t encountered in my previous reading or travel: bleisure, which is a contraction of business and leisure. Wikipedia defines bleisure as the “practice of combining business travel with leisure activities, typically by extending a business trip to include personal time.” The main idea, says Jay Ellenby of Safe Harbours, is to let your career fund your transit: “We often help clients integrate vacation days into business trips to eliminate personal airfare and lodging costs.”

Geoarbitrage

Several sources mentioned the concept of geoarbitrage, which is simply living where the cost of living is more affordable. Devin Partida explored this in an earlier guest blog. This, in turn, allows you to keep growing your investment portfolio, as explored by Jay Samit in his book The Second Act Advantage. “By earning in strong currencies while living and exploring more affordable parts of the world, everyone can enjoy a richer, more adventurous life while actually spending less,” he says.

The key is transitioning from vacationing to geoarbitrage, writes James Tech of TripFrog. “A strategic traveler focusing on FI [financial independence] prioritizes medium-term stays in regions where the cost of living is lower than their home base. By spending months in hubs like Portugal, Mexico, or Southeast Asia, you can often live a high-quality lifestyle for 40% less than in major Western cities. In this model, travel actually accelerates your path to financial independence by lowering your monthly burn rate.” 

One novel suggestion is to make travel a regular fixed expense you plan on incurring every month rather than treating it as an item paid for with ‘loose change’ after all of other ‘necessary’ expenses have been paid.  To me, this evokes the old advice by The Wealthy Barber author David Chilton to “pay yourself first” by allocating set percentages of paycheques to savings. 

Achieving financial independence does not require the austerity of a monk, says Scott Brown, founder of MintWit. “The trick is progressing from pricey, knee-jerk travel to planned-out travel that helps you achieve your FI goals … What we tell people instead is to embrace slow travel, house-sitting, credit-card points travel hacking, and off-season destinations: not cutting out travel altogether.”