So how was I able to quit my job two months ago to plan the round-the-world trip that I'll begin this Sunday?
And how much money do I have to spend on this trip, anyway?
Here are the short answers for those of you who don't want to wade through this whole post:
- a lot of self-control, some extra effort and a bit of good luck
Interested in learning more? Read on, my friends.
LET'S START WITH THE LUCK
I was desperate to find a job after I graduated college, and in the fall of 2009, I began working as a proofreader at an advertising agency.
It wasn't my dream job — I had studied journalism and was unsuccessful in my this-close attempts to land a job with The Seattle Times — but it was work, and I was in no position to be picky. I had big credit-card payments to keep up with, you know.
This particular ad agency paid quarterly bonuses to all employees once they had worked there for three quarters. I began earning bonuses in July 2010 (after I had already become debt-free), and I collected six bonuses during my time there.
Each bonus was in the mid-to-high four figures, and a few were five figures. Altogether, they more than doubled my annual salary.
I consider that to be very lucky indeed.
NOW FOR THE SELF-CONTROL
I could have easily raised my standard of living to meet the amount of money I was making. I could have bought a new car, upgraded to the latest iPhone every time one came out and updated my closet with nicer clothes. It seemed like many of my co-workers did just that.
Instead, I continued to live on my base salary (less than $30,000) and squirreled those bonuses away in my savings account. Maybe I wasn't the coolest kid in town with my 1993 minivan, my lack of an iPhone and my arsenal of cheap, plain t-shirts, but I had more than $10,000 in the bank by the end of 2010.
I eventually gave myself permission to spend money on some stuff — including expensive stuff — but only if that stuff was really important to me. In 2011, I bought a new laptop and a DSLR camera, entered several road races and traveled to Hawaii, Portland, Vancouver, B.C., New York City and Las Vegas.
Sure, I would have a lot more money in my travel fund now if I hadn't spent money on those things, but I don't regret a single penny. Every purchase and experience was planned and meaningful; none of it was frivolous shit.
|OK, maybe this beer was frivolous, but I stand by it, too.|
Plus, it kept things exciting when the ultimate goal — a round-the-world trip — seemed so far off in the future.
A LITTLE EXTRA EFFORT GOES A LONG WAY
It was awesome to watch my savings grow by leaps and bounds every three months, but I felt like I could be saving even more.
In July 2011, I took a good look at my fixed monthly expenses and realized I had no immediate need for $350 of each paycheck. That's an extra $700 a month, or $8,400 a year! (I guess I lived wayyy below my base salary.)
I immediately opened an ING Direct savings account — nickname: Freedom Fund — and set it to automatically withdraw $300 from my checking account each payday. I decided to save $300 per paycheck instead of $350 just to give myself a bit of a cushion.
Guess what? I never missed that $300 per paycheck. Not once.
I continued contributing to the Freedom Fund all the way through the final paycheck I received on Nov. 30. The account now holds more than $3,300. That represents thousands of dollars I never missed, but easily could have wasted on a bunch of little things if it had remained in my easily accessible checking account.
PRIORITIES, PRIORITIES, PRIORITIES
I had planned to continue working through 2012 to become fully vested in my employer's 401(k) match, but I became absolutely miserable and just couldn't stick it out.
By changing my initial plan, I missed out on adding thousands of dollars to my 401(k) and tens of thousands of dollars in bonuses to my travel fund. At first, I felt crazy to give it all up.
But it just wasn't worth another year of my life. In this video, I said, "Over the course of my life, I can make the money back. I just can't get the time back."
You know what, though? I doubt I'll ever make that money back, and I'm not at all torn up about it. I will never regret my decision.
My friend Mike Krass once left this incredible comment on my blog: "No matter how rich or poor, young or old, wise or foolish you are, there is no force powerful enough in this world to recover time for those who have let it pass them by."
BACK TO THE MONEY I DO HAVE
See how easy it is to get caught up in the money you could have, no matter how much you already have? Ugh.
$26,000 is quite a bit of money and I'm happy to have it. (This is what I have after being unemployed for two months and paying for all of my pre-travel preparations, by the way). It may not be much to speak of in terms of getting by for a year in the U.S., but it's more than enough to have some fun around the world, especially while traveling in developing countries. (Check out Shannon O'Donnell's detailed RTW budget — it cost her about $18,000 to visit 15 countries in 11 months.)
I'm operating with a fixed amount of money, though, with no current plans to make more money as I go. My travel fund will only go so far, and I have to consider how much I'll need to return home, if that's what I end up doing. Who knows!
It'll definitely be a challenge to keep an eye on my spending while also making sure to enjoy myself. That's why I'm going to New Zealand and Australia first — they're expensive! I want to visit them while I still have plenty of money.
I plan to use these frugal strategies throughout my travels:
- Stay in inexpensive hostel dorms and guesthouses
- Cook my own food when I have access to a kitchen
- Seek free Wi-Fi or use my Kindle 3G to connect
- Refill my Klean Kanteen instead of buying bottled water (and use my SteriPen in areas with unsafe tap water)
- Use my credit card that has no foreign transaction fees (Marriott Rewards Premier Visa — also earns points that can be converted to miles)
- Redeem points and miles for major flights
- Travel slowly and overland as much as possible
Feel free to add your money-saving travel tips in the comments!
I've loosely planned my trip through July, and the rest of the year is open. If I still have money to travel by then and I'm not sick of life on the road, I'll keep going. If not, I'll do whatever I need to do.
I consider myself extremely privileged to be able to travel for any amount of time, let alone for a full year. I'll do my best to stretch my money far and wide, but no matter what, I'll have a hell of a time.
I plan to put together a post about my packing list this weekend and set it to post on Monday. After that, full blog posts will likely be few and far between due to my uncertain access to Internet.
I should be able to update my Twitter and Facebook page via the Kindle 3G, though, so check them for updates!
There are only two days to go until I depart. While many of you are watching the Super Bowl, I'll be in the air heading to New Zealand!
Let me know who wins. : )