Our most favorite and the FIRE strategy we are currently pursuing is our latest post for our FIRE strategies mini series.
We’ve talked about Geoarbitrage before, but what is it?
It involves leaving a high cost of living (HCOL) for a low cost of living (LCOL) area, while maintaining or increasing your high cost of living salary. This particular strategy will become all the rage over the next several years with so many new remote workers leaving these HCOL areas now that they can work remotely. Geoarbitrage can be accomplished in many ways and even in some cases, it can also create a way to build a real estate portfolio (but we’ll save that for a different day).
The concept of Geoarbitrage is nothing new…
First, you should know that there are two primary types: 1. Domestic Geoarbitrage. 2. International Geoarbitrage. For today’s post, we’re highlighting Domestic Geoarbitrage.
Many who pursue Geoarbitrage, typically rent (or in some cases buy) in areas where the cost of living is significantly less that allows them to maximize their income towards their savings rate. Savings rate is critical for financial independence. Most millionaires set aside more than 38% of their income every month.
We opted to take it a step further…
So to really decrease our monthly expenses, maximize our income, and travel, we bought our RV. Why? Rent at campgrounds is much cheaper than rent at most apartments. Only once on our journey did we pay $1,000 a month for a slip. On average most campgrounds charge between $300-$700 a month depending on location and amenities. Most months our savings rate averaged between 30%-55% over the course of 2.5 years. The current average for most American households sits at 4% or less. 4!
Would you believe us if we told you…
That thanks to Geoarbitrage, we’ve completely changed our financial futures from a life riddled with debt to a life filled with financial independence? More importantly, Eleanor will be introduced to a life filled with time spent together with both of her parents & she’ll hear our stories of our journey, but won’t have the struggle we once did.