Not Your Stereotypical Homeless

A retired California couple of moderate means is on a "permanent" trip around the world:

we're senior gypsies. In early 2011 we sold our house in California and moved the few objects we wanted to keep into a 10-by-15-foot storage unit. Since then, we have lived in furnished apartments and houses in Mexico, Argentina, Florida, Turkey, France, Italy and England. In the next couple of months, we will live in Ireland and Morocco before returning briefly to the U.S. for the holidays.

70-year-old writer Lynne Martin and her husband Tim, 66, have figured out how to make the finances work. [bold added]

Serious number-crunching showed that selling our home in California would allow us to live comfortably almost anyplace in the world. Not having property taxes or a roof that needs fixing can pay for a lot of train rides.

A few specifics about money. Our financial adviser sends us about $6,000 a month, generated from investments. We also collect Social Security and a small pension. [snip]

Since we have eliminated homeownership, we have few bills to pay. We use an online bill-paying service, and we buy almost everything by credit card so we can rack up mileage rewards. One of our daughters receives the mail, which has dwindled to almost nothing.

A good Internet connection is essential. Our computers link us with family and friends, help us plan future travels, and are our source of entertainment in places where movies and television in English are elusive. Each of us has a laptop and an iPhone, and our Kindles house our library and travel books.

We have Medicare and supplemental plans, and when we return to the U.S., we see our doctors for annual checkups. We also have international health insurance covering medical emergencies and evacuations. The plan has a big deductible to help reduce our overhead, since our experiences with health-care providers abroad have been very positive.

The Martins' household budget in California was nearly $8,000 per month. They've been able to keep their expenses to less than that, even in the priciest cities.

WSJ graphic

Observations:

1) The Martins are by no means poor. Working backward from their $6,000 monthly stipend, they would need investment assets of $1.8 million, assuming that they're making withdrawals according to the four-percent rule ($1,800,000 x 4% x 1/12 = $6,000). Selling an average paid-up home in the Bay Area or Orange County would have produced 30-40% of their nest egg.

2) Good health, as well as comprehensive and inexpensive worldwide medical coverage, is key to the peripatetic lifestyle.

3) They are a fortunate couple to have no one dependent on them. The majority of people we know have someone---parents, siblings, children, or grandchildren---who rely on their continued presence and ministrations.

Yes, Lynne and Tim are indeed lucky. Through planning, hard work, and the willingness to take prudent risks they've showed that achieving one's dream is possible even if one begins late in life. Here's hoping that "the wheels [won't] fall off" for many, many years. © 2013 Stephen Yuen