BTW. For most FI-seekers in Switzerland, I’d seriously recommend considering moving to cheaper country to boost their FI date. It might be easier than changing careers.
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How much would you need if you would just travel the world till you die? Would 60k/year be enough?
60k CHF per year? Way more than enough, unless you are backpacking in Norway and Switzerland.
It would be really easy on 20-25k CHF, I think. And doable on 12k CHF, although you’d probably be more limited (i.e., hanging out in SE Asia and/or Latin America). There would likely need to be a pot of money available for healthcare.
However, do not underestimate how much and how rapidly you will change over the course of your life! Endless backpacking sounded like the dream for 20-year old me. About 55 countries later, I still love cheap, light-weight travel (and have done a fair bit of it with kids in tow, too), but the idea of having no fixed address for the rest of my life and being constantly on the move is no longer appealing.
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I consider this a risky strategy. You can’t rely to be in good enough health to travel until you die. And you might get tired of it sooner than you would like.
By the way, living without a fixed home is called being a nomad, and if you’re also working on your laptop from a beach or a coffee shop, then it’s called digital nomad. There are even websites which cater to such people.
When you do this, there are complex domicile/tax topics to get the grasp of. You need to take care that you are legally in a country of your choice.
As for costs, I can give you an example. When I lived in Poland, my monthly expenses were around 1’000 CHF, which is anyway above median net income. It’s enough for a simple life.
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I really like the idea. Spending 3 months in Thailand, then fly to South America, spending a couple of weeks there, flying back to Switzerland to visit some friends and family. But of course that might change with your state of health.
Actually, I have been playing with the idea of being able to travel for longer periods of time (up to a year). This way you can really learn the culture of a place and enjoy lower prices. I like to discover new places, but I don’t like to sit in a plane/train/bus/taxi. But at the same time I would like to keep the Swiss domicile, keep paying taxes here and have a place to come back to.
4 months in Switzerland, 4 months in Poland, 4 months in Thailand? Sounds like a fun year? 
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I mean a few things stand out for me
1/ Many FIRE folks work in tech (high salaries, often math-oriented and highly rationale people, less peer pressure to spend on nice cars, etc).
2/ Delayed gratification isn’t trivial but it is probably a core aspect of nearly all successful people that I know. Not buying something, saving today, etc all goes back to that.
3/ Salaries in Switzerland and the taxation in places like Zug or Schwyz are simply unheard of in the rest of Europe (and it is actually within reach for pretty much everyone with an EU passport)
So if you can combine 1+2+3 it is actually a reasonable goal to reach FIRE 10 or 20 years before the actual retirement age.
On the flipside: my friends in other EU countries (Germany, France, etc), other professions (even law, etc) and so on struggle a lot more. I mean I know tech folks that are making in SF roughly 600-800k (RSU + base) per year but also pay 4-6k for their apartment and California taxes aren’t
exactly enticing. If the external factors are right it really doesn’t matter that much whether you pay (initially) 15bps or 12bps in fees for your ETFs.
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Would you have real estate in Switzerland in that scenario? I’m not sure if buying a flat for 800k (spending 160k of my assets) would get me faster to FI or the opposite.
But I really like your idea. Spending 4 months in a country is totally different to your usual 2 weeks vacation.
I don’t know, that’s a good question. I can only tell you that at the moment I do not own any real estate and thinking about buying a flat only makes me more anxious. I guess owning a bigger place where you rent out a part of it would be helpful for when you’re gone for a long time (for example a holiday chalet with two flats/entrances). It’s convenient to have a fixed address and not depend on your landlord and rent contracts.
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I am a software developer in a financial company based in Zürich.
I would not be so pessimistic, as I really think that this is what our society is slowly transitioning to, FIRE movement or not.
For a long time, most jobs on the job market have been credential-based: you get a nice diploma and it is reasonable to think that you can do the same job your whole life based on this diploma (hence the gatekeeping of high-end universities). As soon as people left school, they did not need to learn any new stuff to keep their job. (this might be exaggerated but you get the idea. Now i am getting to my main point).
I feel like we are going in the direction of a skill-based society, where what matters is the skill that you have, not how you got them. More importantly, the pace of innovation is high enough that this set of skills will only be relevant for several years: you will have to update yourself every 5 years or so to get a new set of wanted skills. This is of course obvious in the IT world where frameworks change every now and then, but i think this mindset will generalize to the whole society. There will be very few credential-based jobs left (maybe family doctor, lawyer), and those who stopped learning after school will be left on the road.
Maybe i am wrong here, but i think that within the next 15 years, switching jobs/career due to renewing skills will be more the norm than the exception.
Those guys do it for 40k USD per year, so it is certainly possible.
This might need to be a bit more with children though.
I have thought about this and slow travel as well. Having a basecamp in a country with a low cost of living to minimize fixed housing expenses (like Poland or Bulgaria) where i would live 3-4 months and spend the rest of the year to explore the world. Nice idea anyway.
For those that cannot wait for FIRE and still want to travel by remote-working, there is this superb link that centralizes all the resources needed to get a remote job. Might be strongly IT-related though.
I can see why people want to own real estate as owning a house instead of renting is somehow recomforting. However, i don’t think that with current prices it accelerates the time to FIRE.
- you have indeed an interest payment that is lower that your rent due to low rates (will it continue?)
- but this is largely compensated by the huge opportunity cost of not having the downpayment compounding at 7-10%
- even if the house appreciates in value, it is hard to translate it into cash flow as you will have to sell the house to realize the gains.
In my case, if i had to own a house that would likely be in Poland. There, houses cost 100k CHF on average.
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As far as I know, you need to stay in a country at least 6 months to be abtax resident. Some countries (e.g. Poland) have different conditions: for example your wife and kids need to stay in the country for at least 6 months.
Having run the numbers myself recently, I found that the calculation changes quite a bit once you FIRE (1-5m in the bank/stock market, a lot of time but probably kids in school/ university, etc).
The travel around the globe with backpack isn’t exactly suitable for most people given those constraints. Finding a city or village in a safe country with decent infra/without or little wealth tax/ low dividend taxation/ good climate/ good and international education/ good healthcare/ reasonable distance to old friends and family/ stable politics/ etc is at least my framework for that time. In short that all brings you back to the usual suspects Portugal, Germany, Cyprus, North of Italy, potentially Switzerland, etc.
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Well, I think you’re overly optimistic. That’s because you assume people are as smart and disciplined as you. I assume they’re as dumb and undisciplined as I am. At least to me most of them seem to look more like me than you.
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I should have mentioned in my first post starting the digression that we actually have discussed this topic already in another thread:
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Try for a second to consider Switzerland your base camp. You can for a second consider a small flat somewhere (1000chf per month) and a simple health insurance to be on the safe side (beware that you can’t join the supplemental insurances on a later age!) 3000chf p.a… So you can spend a minimum of 15000 chf per year to have a base camp here which also helps for tax reasons. This might be a huge amount if you can live in Poland for 12000chf total but it might save your life later.
In other words: Health conditions and land stability scares me. I’d prefer a safe place to consider home even if it might mean to have to spend more.
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Again that only works for a single without family. So by far not the norm and a rather sad vision of someone’s fire end state.
Either you live there or not . If you do, you pay for premium food, have kids in the local schools, etc etc. It might still make sense but just don’t trick yourself with artificially low expense assumptions.
Why? You don’t need kids to be happy.
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Why do you pick only the second part of my statement? I said “single without family”. Is that your desired end state once you hit fire?
-https://www.sciencedirect.com/science/article/abs/pii/S1053535705001745?via%3Dihub
-https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5222535/ (avoid getting kids in the us )
It might be his dsire to live alone, why consider it sad? Don’t judge him.
(I agree that being alone is not the best …)
Anyway mine was an example and you can adjust for two. Regarding kids, I did post on this forum questions/answers about homeschooling and other solutions. It’s doable if that’s what you want.
Also I didn’t write about low expense assumptions. I just pointed out the 2 main points (IMHO) you must have to consider a safe swiss homebase. 1000chf/month for a small flat and 3000chf/year for the health insurance. Multiply x2 or more if you are part of a family. That’s the base. Then you have to add your real expenses on top of it.
Anyway we are going out of topic too much.
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Compare to the classic investments of ETF’s or shares, a real estate investment is normally not the best option. Exception is unless you get a house/flat where the location is superb. But as a house owner myself, I see owning a house more as an investment in my quality of my life. I don’t care about the potential noises of neighbors above/below and if I want to change anything in the house - I just do it. When I am old and a smaller flat would be easier, the kids might have an option to take it (or sell it). And the maintenance costs are not that super high, but this might change in the future. With the low rates (i do actually get some money back), I just putted 2k (what a rented flat might cost) aside and am good to go.
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