The 3 Things Scaring Us the Most in Our FIRE Plans

The 3 Things Scaring Us the Most in Our FIRE PlansBy now, many of you are already familiar with our FIRE plans (financial independence / retire early). I’m leaving my job at the end of 2018 at the age of 43 and then we’re planning to move to Panama in the summer of 2019.  The gap is so that we can let our daughter finish out the school year before we move. The whole idea sounds pretty straightforward, but that’s going to be a lot of change happening within a short period of time.  So obviously, we have some factors making us a little anxious just like any early retiree would have. You might think that our number one fear in our FIRE plans would be running out of money.  Oddly enough, though, it’s not. With the stock market making so many folks nervous hanging out at these record highs, there’s good reason to be a little nervous that the market could tank the day after I leave my job at the end of the year. Although I’d prefer that doesn’t happen, I’m actually not too worried about it.  When I leave work, we should have enough of a cash bucket to carry us for roughly 5 years.  That should leave us in good shape to wait out most bear markets. Then there’s the fact that our portfolio has to last for probably a good 40-50 years… that’s a pretty long time! Is there a chance of us running out of money before we die?  Sure. However, after several retirement calculators and multiple financial guys running our numbers every which way, I think we’re going to be just fine.  Plus, I would guess this blog along with some of the other fun projects I’m planning on doing will bring in some supplemental income anyway. And even if the “fit does hit the shan”, we’re sure to be in good-enough shape that we could just get part-time jobs if really needed at some point down the line.  It’s not in our plans, but it wouldn’t be the end of the world either. No, money isn’t really one of our biggest concerns.  Nevertheless, there are a few things that are weighing on our minds…  

The 3 Things Scaring Us the Most in Our FIRE Plans

Divided Thoughts on Life in Panama

The 3 Things Scaring Us the Most in Our FIRE Plans - Divided Thoughts on Life in Panama
Thumbs up or thumbs down? Hopefully, all three of us vote the same way!
There’s a lot of excitement in the R2R household about moving to Panama next year.  As you’d expect, there’s also a little fear about some of the unknowns, but nothing too crazy. As our eight-year-old daughter said to Mrs. R2R, “Remember, mom – this is an adventure.  There will be pluses and minuses no matter what we’re doing.” Love that kid.  I think that about says it all.  She’s got the right idea and it’s the same attitude we’re all going in with. So that’s the easy part. It would also great if we all got down there and loved it.  That’s the dream and hopefully, that’s the outcome.  We have a vision that we’ll adjust to the cultural differences and enjoy living in a new country we’ll be able to call home. But we’re also not blind to the fact that this is going to be much different than living here in the States – extremely different.  Working in our favor is that we’re a pretty easy-going family and it takes a lot to really throw us off… we generally just kind of roll with things. On the flip-side, it’s really not too bad if we decide to come back to the U.S. if we realize that it’s just not the life for us either. We’ve already thought about Tennessee as a possible U.S. retirement option.  We’ve been there for vacation a couple of times and loved it there.  It seems to generally make the lists as a good retirement state with no state income tax, a low cost of living, lower than average health care costs (as far as the U.S goes!), and weather we could be happy with. Although the numbers in our FIRE plans are based around living here in the States, it would still be a lot tighter than it would be while living in Panama. Regardless, we could make it work and still be just fine.  So that wouldn’t be a game changer either. However, there’s a third possibility that could be a much tougher pill to swallow.  What if we have a split decision? What if one or more of us love it in Panama and don’t want to leave while the other person (or two) hate it and want to head back to the States? That has the definite potential to make for a rough outcome.  And the likelihood of this happening is really not that slim.  Three of us going to a foreign country, leaving behind all friends and family, and changing everything in our lives at the same time… there’s bound to be some mixed opinions in this recipe! We did set a few basic “rules” to help us plan for this to a degree from the start though:
  • We give it at least a year
  • It’s an adventure – we have to try new things and give everything a chance
  • Two out of three votes to move back wins
They’re simple rules, but I like simple.  And those rules won’t solve all our problems, but it will help to make sure we’re all on the same page right out of the gate. Even so, if we’re not all in agreement after that year is up, it’s possible that it causes some animosity that we’ll just have to deal with and figure out at that time.  

The Unknowns of Health Care

The 3 Things Scaring Us the Most in Our FIRE Plans - The Unknowns of Health Care
This could almost be the log of health care coverage in the U.S.
I think this is going to be the big question mark for most everyone considering early retirement. The cost of health care in this country is insane and stupid.  I don’t think there’s anyone that can disagree with that statement. No one knows what’s going to happen in the future, but I’m guessing that things can only get worse before they get better.  Maybe the joint effort between Amazon, Berkshire Hathaway, and JPMorgan will either come up a good solution or open the eyes of others enough to bring about change in a different manner. Something’s going to have to give at some point.  Most folks in the U.S. along with employers subsidizing health care are feeling more than a pinch right now.  Something’s got to change. Or is that just me seeing the desperation of people and trying to have a glimmer of hope?  I’m really not sure. Either way, the most difficult part of early retirees’ FIRE plans here in the U.S. tends to be figuring out a way to cover the costs of health coverage.  The reason?  Nobody knows what to expect.  It’s pretty crazy. Now, our situation is slightly different than most.  With our move out of the U.S., we get to “escape” from a lot of the health care fun we have here.  Health care in Panama is good, but very cheap – my favorite combination! In fact, many expats in Panama don’t even have health insurance.  That’s not going to work for us though.  I think I’d feel a little too naked without having any coverage.  Plus, we’re going to be bouncing back and forth between Panama and the U.S., especially for that first year before we apply for residency. So our plan is to get expat insurance.  As long as we stay out of our home country (the U.S.) for half the year, expat insurance will cover us both in the U.S. and in Panama (along with most other countries throughout the globe). That should work great for us… it’s so much cheaper than getting insurance through the market (assuming no subsidies) and gives us full coverage wherever we’re at. However, if we decide to move back from Panama for whatever reason, we have a new fear.  We’re now going to be in the same boat as most early retirees in that we’ll be subject to the health coverage in the U.S… ouch! We did include some best guesses on costs in the U.S as part of our FIRE plans.  But like everyone else in the entire country, we don’t really have a clue what it’s going to be even a couple years into the future. For the time being, I’d like to think that we’d end up using a health care sharing ministry like Liberty Health Share.  These programs were exempt from the Affordable Care Act (ACA) and offer a viable alternative with some concessions. But will they stay exempt?  Will Obamacare be changed or repealed at some point completely?  Will health insurance go up or down… unfortunately, nobody knows.  And these questions can go on for the next few decades before we’re even eligible for Medicare. If we don’t end up liking Panama but prices continue to increase dramatically, we may be stuck there because we couldn’t afford to move back. So for the time being, this subject makes us pretty uneasy and is definitely one of the things that scares us about our FIRE plans.  

Figuring Out Home Schooling

The 3 Things Scaring Us the Most in Our FIRE Plans - Figuring Out Home Schooling
If we’re going to be homeschooling, shouldn’t we buy something like this that we could call a school bus? Um, not so much.
Although there’s not anything stopping us from doing so, we decided not to go after residency right off the bat when we move to Panama. The reason for this is mainly the cost.  It will likely cost us between $5,000 and $7,500 for the attorney and everything we need to do to make it happen. Although we’ve encompassed this cost in our FIRE plans, we want to make sure it’s the right place for us first.  Why throw down that much money with the possibility that we might hate living there and move back after a year? Because of that, we need to play by the tourist rules.  And those rules mean that we can’t be in the country for more than 180 days at a time and we’ll need to stay out for 30 days to reset the clock. And just to complicate things, our U.S. driver’s licenses are only good for 90 days at a time there. Fun, right?  In a nutshell, until we decide to apply for residency, we’re going to be making a few trips back to the States. Because of that, schooling our daughter for at least that first year isn’t going to work.  So… we’re planning on homeschooling our daughter for at least that amount of time. The good news is that we’re experts when it comes to homeschooling.  The bad news is that I’m a big, old, fat fibber and we don’t know diddly about it. We’ve already decided that I’ll be doing most, if not all, of the teaching (best of luck to our daughter!).  And right now, Mrs. R2R has been digging into some of the different curriculum choices out there. Even though homeschooling is looked upon as a little less crazy than people used to view it, it’s still not something that most folks are doing.  And because of that, it’s not as structured as regular schooling is. That can be a benefit in that we’ll have a lot more freedom and flexibility in our daughter’s education.  But that also means that we’ll have to figure out a lot of this as we go. I’m sure we’ll manage and based on the support we’ve already been getting from others in the community who’ve done this, I’m betting it will actually be a great thing. However, it’s still a big unknown to us and we all know that unknowns tend to be a little bit scary.
Everyone’s going to have different fears in their FIRE plans as they make their way closer to their new freedom, but these are the three things making us a little uneasy right now. I’m a little weird in that I actually like change.  It’s not that I get bored with the same-old, but rather that I’m intrigued to see what will happen if I change things up. So, this little bit of fear is actually something I’m Ok with… we’ll call it an adrenaline rush.  Hopefully, Mrs. R2R and our daughter will feel the same on this upcoming adventure!  
Is there anything in your own FIRE plans that scare you?
  Thanks for reading!! — Jim
You know you wanna share this!!

14 thoughts on “The 3 Things Scaring Us the Most in Our FIRE Plans”

  1. Three big things worry us. Healthcare, healthcare and healthcare. We are FI and semi-retired. We do have health insurance until our planned full retirement in 5 years at 57. That leaves a gap until Medicare. I have been reading up on those medishare programs that you mentioned. As a recovering healthcare administrator, yes, the system is broken in the United States. Too much to cover so I won’t bore you.

    You guys have this well planned out so you will do fine. I love the spirit of your daughter – “It’s an adventure.”

    1. I could only imagine the inside scoop you could give on the healthcare system… probably more than most of us could even stand to hear!

      Good luck on finding a solution for the gap until Medicare!

      — Jim

  2. My biggest worry is healthcare as well. The system here is pretty crazy. Why can’t we work something reasonable out? The rest of the world seems to be doing okay.
    Your plan sounds good. Moving to a foreign country is a huge change and you need to give it at least a year. Homeschooling sounds okay for a year. We’ll probably do that at some point as well, for one year.

  3. I certainly appreciate all three of your concerns and they are BIG concerns. Panama is a nice idea to reside for a year but long term??? Tennessee is better option for your lifelong retirement. Anywhere in the South, including my home state of TX are viable choices to live and retire long term. My wife and I are entertaining the option of renting a condo in Grand Cayman for the first 6-12 months of our early retirement. This is NOT our longterm locale for living, simply an enjoyable place.
    Healthcare: This plays a HUGE role in your plans, my plans, everyone’s plans as our current system SUCKS! I am also looking into health sharing ministries and this could turn out to be the best way to go. Repeal and replacement of ACA is another big question mark. Will it happen? Will is worsen the current system or will it actually improve it? Politicians know nothing of healthcare and they only do what they can to appease voters in the short term, they are incapable of providing a longterm solution to a crappy system in place. Single payer system like Europe and Canada is unfortunately, the only remedy that exists.
    Your Home Schooling: Definitely a concern as you want the very BEST for your kids. Keep striving to provide them with the best education possible. Our children are what life’s all about!

    1. I like the thoughts, Mr. Fire – it’s good that we can share some differences of opinion on some things. Listening to different perspectives gives all of us a chance to make better decisions.

      I would say that it’s definitely a matter of preference on the location we live. We’re actually looking forward to the slower-moving lifestyle, but I do recognize that’s not for everyone. We’ll see how it goes though!

      Some folks hate the idea of homeschooling, but it’s truly possible to give kids a better education than traditional schooling. The ability to work one-on-one with their teacher is something that most kids would never get the opportunity to have. Our daughter is a smart kid and that can sometimes be tough where a teacher needs to find a happy medium between teaching to a higher or lower standard to take care of all the kids in a classroom. Homeschooling her has the potential to teach her to a level that can’t be done in a typical classroom. Again, definitely not for everyone, but I think this will be a good thing and I’m definitely looking forward to it.

      — Jim

  4. Yeah, healthcare is absolutely ridiculous. Anyone who doesn’t think so just needs to look at the costs for comparable care in other countries.

    But I shouldn’t complain. We’re pretty healthy and other than regular checkups don’t have much in the way of healthcare costs.

    I think it’s completely normal to have fears…. but don’t let them stop you. The things you fear may or may not even be real issues!

    1. That’s a great point, Mr. Tako – when you’re pretty healthy, it does make things a little easier. Sounds like we’re in a similar boat where we don’t spend very much time at the doctor’s office. I’m hoping that will be even less once we have more time on our hands to be able to cook better and just get out and walk around more.

      — Jim

  5. Healthcare insurance is partially what keeps me working full time for now. We’re FI and my husband just fully retired this year at age 53. I am still working full time (13 shifts per month) but would love to go part time down to 6 shifts a month so we could travel more. If I go down to part time, only my health insurance is covered and not my husband’s. So we’d have to negotiate whatever government changes are made to obtain his health insurance if I go part time. We’re able to travel a lot more now that he retired, but the more traveling we do, the more we want to do and I can see a point will come when I’d like to go part time if I could secure good health insurance for him.

    1. Haha, once you get a taste of the travel bug, I could see how you would want to travel even more! I hear you on the insurance – that really keeps way too many folks from being able to focus on living the life they want to. If you haven’t looked into the health care sharing ministries, you might want to check them out to see if they might provide something that would work for you. It’s a huge difference in cost over the traditional insurance, but it’s not a direct replacement either so you need to be aware of the disadvantages as well.

      — Jim

  6. Yeah, I am following the plans of Berkshire Hathaway, Amazon & JP Morgan and am particularly intrigued that they hired Atul Gawande as the CEO. He has written some interesting stuff for The New Yorker.

    Hopefully, you’ll love Panama but if not it will be fascinating to see what happens in US with healthcare…things are ripe for disruption.

    From the little I know about you, I think you’ll do great at homeschooling your daughter 🙂

    What if you have a split verdict on Panama – hmm, I cannot help you there except to say a little diversity can make things interesting!

    1. I know a lot of people seemed intrigued when they made Atul Gawande the CEO. I don’t know anything about him, but hopefully he can lead the initiative into a different direction that gains enough traction to disrupt this system.

      — Jim

  7. At this point I think I’m too early on to really have any fears beyond thinking the end of the tunnel is too far away to see the light, but I’m sure my dear old friend anxiety will have something to say about that!

    1. Haha, stupid anxiety! 🙂 The good news is that the stuff that’s rattling my cage really isn’t that bad. Hopefully when you get ready for your next adventure, anxiety won’t be a show-stopper for you either!

      — Jim

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