Forget the house, travel instead

Saving-for-a-HomeAbout 14 years ago, after I had moved to Minneapolis, my friend Jo had invited me to a presentation at REI.  A young woman in her 30’s had just traveled for 6 months to India and Nepal.  I remember her telling the audience that she had just saved enough money for a down payment on a house, but instead of buying a house, something had prompted her to travel instead.  This was years before I had acquired the travel bug, and honestly I was there because my friend Jo, a fellow traveler, was looking for ways to satisfy his own wanderlust.  I hadn’t thought about it much as I plodded along, working in corporate america, and eventually saving enough money myself where I was comfortable to buy my own home.  And in 2005, I finally did buy my first home.  And now, upon reflection, I wish I would have payed more attention to the possibilities being created in my life and refrained from buying a house.

People acquire houses for many different reasons.  For starters, as young adults, we’re often told that a house is a good investment because a) we’re not throwing our money away on rent every month and b) the house can appreciate over time.  Secondly, owning a house is seen as a sign of success in our society.  It is considered a major life achievement to own a home.  And of course, as a home owner, you can eventually make the leap towards renting out your home if you have those entrepreneurial ambitions.  Property is a symbol of your ever-expanding empire, in a sense.  Let’s also not forget that it is nice to have our own space, something that you can enhance to your liking and have your own creative space.

Upon entering my 30’s, I too, took the red pill and purchased a home.  In trying to be frugal, I finally decided on one half of a small twin home.  At 1200 square feet, it was modest, but perfect for my tastes.  And while I was extremely happy living in this home for the 8 years after I purchased it, I wish that there were some things that I understood before purchasing a home.

Homes are money pits

If you’ve ever seen the movie “The Money Pit” you’ll understand my reference.  While obviously over-the-top in humor and absurdity, the movie does have a good point.  All houses require maintenance and upkeep, and it is usually not cheap to maintain a functioning house.  Even a house in good condition can easily require a couple thousand dollars a year in maintenance fees.  If you’re somewhat savvy as a handyman, you can reduce this cost, but it doesn’t completely disappear.  As a first time homeowner, there’s many things that you’ll likely not pay attention to.  My home has a sewage ejection system that pumps everything from my house out into the street and up a hill to get to a sewage mainline.  When it is functioning, then everything is great.  But when it breaks it’s anywhere’s from $700 to $2500 to repair.  The pumps usually stay in good condition for 2 to 5 years.  Go ahead and do the math and factor that into your monthly costs.  On top of those costs, you need to think about big appliances (washers, dryers, etc) breaking, plumbing problems, exterior maintenance (painting, roof, lawn care, etc).

Your mortgage can make or break the situation

I’m somewhat embarrassed to admit that I was one of those individuals that got caught up in the purchasing boom around 2005.  Being not sure of how long I wanted to stay in the house, I went with a 3 year Adjustable Rate Mortgage, with no down payment.  Anything below 20% down is also subject to mortgage insurance.  There are ways to avoid this, but keep in mind a tax will be added to your mortgage which won’t automatically come off after the loan is paid down to 78% of its original value.  After 2008 when the value of my home fell almost $70,000 in value, I was unable to refinance due to many different factors.  Thankfully, the Adjustable Rate Mortgage (which resets every 6 months) has remained fairly steady and has not increased any.  However, I’m always a bit worried about what happens when interest rates start rising again.  I’ve ridden out the storm surprisingly well, but the issues surrounding my home are a small annoyance and fear, always in the background.

Buying and Selling homes is expensive (and not easy)

Typically, you can expect to pay between $3000 and $5000 for broker and real-estate fees when purchasing or selling a home.  You can get that cost added to your mortgage so that you may pay it off over time, but it’s still something you have to pay.  Also, keep in mind that selling a home doesn’t always go as smoothly as you may have it built up in your mind.  After you decide to sell, there are appraisal costs and inspections that you have to undergo before you can sell the home.  And if the market is soft, depending on how badly you want to rid yourself of your property, you may end up accepting a far lower cost and still owe money on it after you’ve sold it.

Renting your house is not easy, either

If you do decide to travel, you may convince yourself that you’ll just rent out your house. While definitely a viable option (it’s what I did), keep in mind that it’s not as simple as just putting and ad on craigslist or padmapper.  You’ll most likely have to acquire a rental license from the city which requires money, inspections, and in my case, a required renter’s orientation class provided by the city.  If you’re smart, you’ll also hire someone that will manage the place for you while your gone.  Remember, that while you’re hiking the trail to Macchu Piccu, you’ll sometimes have worries about your property in the back of your head.  And let us not forget that unless you sell everything you own, you’ll need to find a place to store all your stuff after moving out of your place.

All the stuff that you’ll acquire

Like goldfish expanding to the size of our environments, owning a home (bigger space) can prompt us to acquire more things.  This is partly what anchor’s us.  All of those possessions that we rarely glimpse and get stowed away somewhere far from regular use.  I spent a full year to year and a half emotionally-parting from all of my things, selling them off or giving them away so that I could travel more easily.  The process was long and cumbersome.  I’ll never go back and am much happier now having gone through that process, but it is painful nonetheless.

Houses are not that great for investment purposes

While houses are known to appreciate over time, there’s ample evidence that suggests that the value of homes increases due to inflation only, and the actual value of the home only increases a mere 0.2%.  And let’s not forget the money you’ll be investing in your home for repairs and enhancements.  Unless you have the mindset where you like to put in a lot of your own manual labor and turn the houses yourself, I think you’ll be spending far more money and having more frustration hiring professional contractors to repair / upgrade your property. If you’re not sure if you’re ready to settle down, you should instead invest your money in an interest-bearing account that conservatively generates 5%.  That’s much better than the 0.2% you’ll see over the long term.

People Change (of course), as does everything else

As much as you’re committed to your vision of settling down, and creating a life for yourself, you don’t really know how your life is going to unfold.  At 35, I realized that I wanted to travel the world.  You may not have ambitions to travel, but you may lose your job, or cease to enjoy living in the neighborhood where you live, or receive a kick-ass job opportunity out in Portland or Vancouver.  Your life is going to change in so many, unexpected ways, and when you’re young(ish), a house is going to make it that much more difficult to flow with the amazing opportunities that are on your horizon.

After my foray into home ownership, I’ve developed a fairly jaded view towards this enterprise.  However, I do not believe that one should never own property.  In fact, while I’m still a bit raw from my experience with the current property I own, I’m sure that I will buy another property in the future.  It’s just that I plan on being much smarter about it the next time around.  I will not buy a home unless I have the full 20% to put down.  I personally think it’s better to buy a home outright, if you can, as a 30 year mortgage can leave you paying 250% of your home’s value after you have made all payments and paid off the interest and insurance.  And, if I was to do a mortgage again, I’d be sure to opt for a 15 year loan, instead.  Or better yet, for someone who is single, I’d recommend buying a tiny home for $30,000, save your money and then retire early.

Now, many people reading this may think I’m advocating a nomadic lifestyle of never settling down or making any kind of commitment.  That couldn’t be farther from the truth.  I’m only advocating taking a moment (or ten) and rethinking your desires to own a home.  While the market might look good and you might feel the pressure of getting a good deal, step back and really look at whether you’re ready for a home and whether it will really benefit your lifestyle.  I advocate that people be smarter in saving their money.  And if your dreams are in owning a home, go for it.  Otherwise, hold off and travel the world (or follow whatever other dream you may have).

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Goldfish

“The things you own end up owning you. It’s only after you lose everything that you’re free to do anything.” – Chuck Palahniuk, Fight Club

“It is the preoccupation with possessions, more than anything else that prevents us from living freely and nobly.” – Bertrand Russell

There’s a common myth that goldfish will grow in proportion to the size of their environment, meaning that a goldfish living in a pool will grow to a much larger size than a goldfish living in a small bowl.  The truth is that goldfish grow based on their diet and quality of the environment that they live.  Despite the above myth, I find a striking correlation between the myth of goldfish filling their environments and the way people accumulate things based on the size of their environments.

When I first moved away from college and got my first apartment, I had barely anything more than clothes, a computer, a bed, and a small 13″ TV.  After working in IT for a couple years, I quickly filled that apartment with a couch, 27″ TV, Hockey Gear, Kitchen items, etc.  The apartment had quickly run out of space.  After moving into my house, I once again felt compelled to fill the additional space that I had just purchased.  So, I bought more stuff.  Over time, I filled the space with an entertainment center, fancy kitchen table and chairs, deck chairs, tools, etc.  Like a goldfish, I was “growing” in proportion to the space in my new environment.

When I started planning my trip abroad, I knew that I would need to downgrade my lifestyle quite a bit and sell off a lot of my possessions.  I’d be living out of a backpack for awhile and knew that keeping a bunch of things around and unused for a long duration of time would be ridiculous.  I was actually looking forward to this, because around the same time, I noticed there were many items that had gone unused for years in my basement.  I decided to start cleaning up that area.  For the most part, it wasn’t difficult due to the fact that much of the stuff was not in the best condition.  But there were a couple items that I noticed I had some hesitation of getting rid of.  I hadn’t played hockey in years….. yet….. I found myself wanting to keep the equipment.  Over time, I finally realized I was being irrational and finally gave up the hockey equipment.

When I decided to finally sell my motorcycle, I finally saw for the first time the difficulty in parting ways with certain items.  But why?  It finally dawned on me one day when I started analyzing the items I was having most difficulty parting with.  It was the items that I associated my identity with the most.  The motorcycle, hockey gear, kitchen supplies, books, etc.  Even though I knew I would not have a need for any of this stuff in the near future or ever again, I felt like parting with it was also parting with a part of my identity.

I’ve moved twice in the past 6 months – once after I rented out my house, and the other time, just last week.  Each time, thinking I’ve parted with enough of my stuff and that the move should be simple, I’ve once again had my eyes opened to how much stuff I’m still clinging to.  I still have too much stuff.  So, I’ll attempt to “shed” my belongings again.  Initially, I had this romanticized idea of selling everything off and starting over.  With time and multiple rounds of simplification, I can honestly say that I’ve miscalculated how difficult this would be for my personality.  However, with each step at simplifying my life and reducing the number of items that I own, I feel happier.  I don’t worry about my stuff getting stolen or burned up in a fire anymore, and I feel much more free to live and enjoy my life the way that I want..

So what will happen after I’ve rid myself of most of my stuff and live out of a backpack for awhile?  That’s the question I’ve been asking myself lately.  I hope that the answer is much like the goldfish analogy that I just used, but instead of acquiring more “things”, it will be my spirit that will grow in proportion to the size of my new environment (the world) and be filled with (hopefully) all the wisdom and perspective that only my upcoming adventures can provide.

Momentum

It’s been two months since I started this blog and a lot has happened.  As it stands now, I’ll be leaving for South America on the 5th of November.  I’ve purchased two tickets thus far.  I stared with the ticket from Santiago, Chile to Hanga Roa, Easter Island which will actually take place 3 months into my trip.  I scheduled that for the beginning of February so that I could be there for the Tapati Festival.  However, this is done with the full knowledge that my schedule may change and my arrival in Easter Island could be pushed back.  Next, I purchased my starting ticket – a one-way flight to Ecuador in the beginning of November.  Right away, it felt good to be making some commitment towards my adventure.

And now, there’s a momentum that has formed that I’ve noticed is starting to take on a life of its own.  Despite all my insecurities and fears, I feel like I can’t stop these plans even if I wanted to.  I liken myself, somewhat, to a very manly Sandra Bullock, attempting to direct an out-of-control bus that cannot be slowed otherwise it will explode and could easily go careening off of some overpass at any moment.

This has prompted me to think a lot about how momentum gets created and then escalates and accelerates our plans.  Because I’m a huge procrastinator, plans sometimes take forever to materialize for me (or at least it seems so).  I’d love to be one of those people that can make a decision and instantly make progress towards their goal.  But instead, I tend to be one that thinks things over, second-guessing and triple-guessing myself and doubting myself along the way, until eventually, I force myself, arms flailing off the cliff into the dark, unknown abyss.

I probably don’t give myself enough credit.  I know myself, and many times I have to create a situation where I must force myself to create some momentum for the desired goal.  For example, when I was in college, I decided that I wanted to learn to ride motorcycles.  So, I took a motorcycle safety class so that I could get my motorcycle endorsement on my license.  Taking the class wasn’t the difficult part.  Instead, the difficulty came when I wanted to buy a motorcycle.  I mulled over price and style, procrastinating on the purchase, until finally I purchased a motorcycle helmet that I knew I would need to ride my motorcycle.  It’s back-asswards and weird……. yet, I had purchased something that helped me finally make the purchase that I ultimately wanted:  a 1979 Kawasaki KZ650 road bike.  It’s not for everyone, but it worked for me.  It’s the same with the airplane purchases.  While I was going back and forth on when I should buy my ticket to South America, I instead focused on one of my major goals for the trip, and that was to go to Easter Island.  And it worked – within a week after that purchase, I had purchased my ticket to Ecuador.

Of course, this trip is too big for me, and I’ve needed a lot of help and encouragement from the people around me to help make this dream a reality.  This past summer, I met a woman who turned out to be my life-coach.  Serendipitously, she had traveled extensively in South America and thought my idea was a grand plan.  While our initial meetings were centered around figuring out what my purpose and vocation in life should be, she also held me accountable for my dream to travel extensively in South America.

Additionally, I participate in many groups where I’m exposed to people from different countries and cultures.  I attend a weekly conversation group for french speakers, the 20/30s International Happy Hour Meetup, and Internations gatherings.  In everyone of these settings, I’m exposed to people from other countries and cultures, or expatriates that love to travel.  Talking to these individuals, I meet a lot of people that support my goals and offer me sound advice.  These people are my tribe and I’ve found understand me the best.  They nudge me forward when I’m feeling insecure and unsure about the path that I’ve chosen.

And lastly, I’m fortunate enough to have family and friends that support my goals.  I think most of my friends have been very supportive.  My parents were initially worried about my plans for world travel, but have since started to support me wholeheartedly.  I was on Skype with my mother the other day, and she informed me that my father had just purchased a South America map so that he could follow my adventures as I’m taking them.  How could one possibly give up their goal knowing that their parents will be following them every step of the way?

It’s imperative, I believe, to open yourself up and share your ideas and plans with the people that support you and / or have had similar experiences as the one(s) you’re trying to accomplish.  I helps to encourage you on your path and ultimately create that much needed momentum for achieving your goals.

Dangerous Ideas

“All men dream, but not equally.  Those who dream by night in the dusty recesses of their minds, wake in the day to find that it was vanity, but the dreamers of the day are dangerous men, for they may act on their dreams with open eyes, to make them possible.”  — T. E. Lawrence

The whole idea started simply enough.  In 2009, I had decided to take my first transatlantic trip by myself.  Actually, it was the first trip of it’s kind for me.  I’d been to Canada on multiple occasions, Central America, and the Caribbean.  But France….. it was a long way for me.  Before I left, I had found a Vineyard in the Languedoc region of France that also serves as a Bed and Breakfast.  Arriving at Chateau Haut-Blanville can be a bit of a challenge considering there is no public transportation from its closest city, Bezier.  It was a major highlight of my trip, and one that I almost did not accomplish.  After being stranded in Bezier for one night due to problems encountered using my credit card to book the rental car, I thought I’d have to miss this part of the trip.  But I was committed – so I asked around and located a motorcycle dealership that rented motorcycles just 15 km away.  After arriving there and waiting around for 2 hours, I was able to finally acquire a motorcycle for 2 nights.  An hour and a half later, I arrived at the Chateau.

Later in the day, I found myself relaxing in an Adirondack chair reading the book Vagabonding by Rolf Potts.  I was glued to this book that was describing to me all the experiences I could be having traveling the world, and how to go about doing it.  Maybe it was my new-found confidence arriving at my destination, but I was immediately taken with the idea of traveling the world myself.  The book describes in detail some of the things a person will most likely need to do to make traveling for an extended period of time a reality.  For me, this included renting or selling my house, downgrading my life, finding cheaper ways to travel, do a better job budgeting my cash-flow, save enough money to sustain me for the duration of my trip, etc.

I knew it wouldn’t be easy and quite honestly, I’m not sure I fully committed to the idea right away.  But it infected me and once I finally committed to the idea, it helped me to focus my energies towards completing some projects and to organize my life to help make this dream a reality.  I was in the middle of finishing off my basement and doing some repairs to my house.  I also had a room under my garage full of junk and unused items that I knew I would need to get rid of.

It has been huge undertaking for me.  It’s quite possibly the largest project I’ve ever undertaken.  My magnum-opus, if you will.  I’ve had to undergo a huge transformation and conquer many challenges, fears, and insecurities along the way.  It has been almost 4 years since I sat in that Adirondack chair and first had this idea.  I’ve had to make many sacrifices and take a much different path than I thought I originally would have made.  I’m currently three to four months out from my departure and to be perfectly honest, I’m scared.  But, the trans-formative potential that this idea could have on my life is too great to ignore.  It’s an ambitious idea and I’m excited.

The idea is this – fly to South America and visit Peru, Ecuador, Argentina and Chile.  From Santiago, Chile, I hope to take a flight to Easter Island.  Easter Island has been a huge draw for me ever since I first saw pictures of the large Moai when I was in the 3rd grade.  After Easter Island, I hope to fly to Southeast Asia for some Scuba Diving.  I hope to be gone 6 months to a year.  Am I crazy for doing this?  Possibly.  But I believe that it takes a little bit of “crazy” to accomplish great things.