Money movements of Americans who quit their jobs and moved abroad

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For many Americans, the idea of ​​retiring early and moving abroad has an undeniable appeal. After all, who hasn’t sat down at their desk and dreamed of strolling the streets of a new city or feeling the Caribbean sand under their toes?

Here’s a look at three people who made that dream a reality and the financial strategies that helped them achieve financial independence.

Earn more on the side: “We had to go out and earn some extra money”

The Financially Independent, Early Retirement movement known as FIRE focuses on maximizing the amount of money you can put away in investment accounts that, in theory, grow at a compounding rate over time. To increase the amount you save, you can spend less or earn more.

Or you can try to do both.

Take Amon and Christina Browning, who retired to Portugal in 2019 when Amon was 39 and Christina was 41. When they decided to embark on early retirement, the couple were earning $168,000 a year while by supporting two children in the San Francisco Bay Area. Area.

“We knew from our jobs that if we saved as much money as we could, for many years, we still wouldn’t be able to retire early,” Christina told CNBC Make It. “We needed to go out and make some extra money. So that was a priority for us.”

Amon and Christina Browning with their daughters, Sunoa, 14, and Melea, 13.

Courtesy of Amon and Christina Browning

The Brownings spent their weekends flipping houses and driving for ride-sharing services such as Uber. They lived as frugally as possible and made even more money by selling extra household items and personal items on the Facebook Marketplace.

But even earning and saving extra money wouldn’t have been enough to retire if he hadn’t been able to generate interest. “We put our money back into the stock market, into real estate, so we could get that compounding effect,” Christina said. “That’s how you get your financial independence.”

Invest regularly: “I’m very interested in the stock market, don’t touch it”

Roshida Dowe was a diligent investor even before considering early retirement. She earned returns by investing in real estate, she built most of her portfolio, constantly setting aside part of her salary, which was around $200,000 before she retired.

“The investment strategy that has worked the best for me has just been to invest in mutual funds, so I’m very involved in the stock market, hands-off,” she told CNBC Make It. . “Give it to a brokerage firm, invest it in one of their mutual funds, set it and forget it.”

In 2018, Dowe was fired from her job, so she took a year off to travel. “Traveling and seeing that the way we kill ourselves to death in America is not common in the world made me realize that I could have a different life if I made the choice to have a different life,” says- she.

Dowe took a year off to travel the world after being fired from her job as a corporate lawyer.

Source: Roshida Dowe

So she did the math. In total, his investments totaled approximately $660,000. Traditionally, FIRE members have relied on an annual withdrawal rate of 4% to determine how much income they could draw from their portfolio during their extended retirement.

The sum Dowe had might not have been enough to finance his lifestyle without working in the United States, but it was enough to allow him to live comfortably in Mexico City – where his monthly expenses fell to $2,300. per month – “for at least a while.”

Even though she had the money to take a few years off or more, Dowe continues to do work she loves, serving as a life coach for women looking to take a break from their careers and running a YouTube channel documenting his travels.

Added income streams: “Rentals help us diversify our investment portfolio”

Many adherents of the FIRE movement bristle at traditional characterizations of retirement. Rather than striving for days filled with piña coladas and rounds of golf, many future retirees hope to continue reinventing what life can be like after leaving their 9 to 5.

Take Dianne and Guillermo Rastelli, who retired in 2018 at 44 and 47, respectively, with $2.2 million. After attempting a retreat in Mexico, they recently settled in Lisbon, Portugal, but plan to keep looking. The couple currently run a YouTube channel about their financial journey and their search for a “forever home” in retirement.

Guillermo and Dianne Rastelli took early retirement with $2.2 million saved up and currently reside in Portugal

Mariana Castelo Branco

One thing that allows the Rastelli the kind of flexibility they have: diversified income. While the couple are able to draw money from their investment portfolio of mostly index funds, they benefit from income from three rental properties in northern Virginia.

“Rentals help us diversify our investment portfolio,” Dianne told CNBC Make It. “It’s helped us be a little more comfortable being able to have financial independence without having to worry so much about having all our money in one place.”

An additional income stream can act as a kind of buffer during periods of market volatility, according to experts at FIRE. It allows the retiree to continue to pay living expenses without having to withdraw money from investments that have lost value.

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