Monday, November 30, 2009

Financing my Dream

Faith is forward motion. –Karen Maezen Miller

Money is always a part of reality... unfortunate, but true. To make my dream a reality, I have to revise my personal lifestyle and daily budget to make it happen. I've been looking at other travelers, talking to friends and crunching numbers. I'm great at research and ideas but not so good at the follow through. I'm not good or used to telling myself "no".

Living the Dream decided on a budget of $30,000 for a little over a year (415 days). It's a flexible plan and it allows for cheaper countries to make up for more expensive countries. I want to travel for a longer time, at a slower pace and experience more of living like the locals. I plan more home stays, work for board, jobs as I move around the world so I can limit my expenses and continue my income. Plus I'm hoping to have another source of income (more on that later) besides whatever I'm earning at my work/stay job.

I need to do more research on:

1. Costs of Visas

2. Transfer Taxes

3. Shipping Charges (Gifts, Souvenirs, Holidays, etc - sending packages home)

4. Health Insurance (Cobra? Travelers? Job Provided?)

5. Pre-Trip Purchases (what do I need?)

How much do these cost? What's my personal needs? What's my comfort level? What am I forgetting?

One thing I've learned is I need an international bank, with partnerships around the world, and offering a 4 digit PIN (I didn't even know PINs came in larger numbers). The most highly recommended bank was HSBC so I've looked into their account choices - I'll be able to link my international account with my current local bank through a money market account. Maintaining my local bank account will allow my parents to have emergency access - I'll have to set that up before I leave - they don't currently have access but it's a small town with a small town bank and they know we're related but if I make it official, it could save some time and make it easier on everyone.

  • $1500 in travel savings to open checking account
  • $1500 for Money Market account to meet free account minimums.

TOTAL = $3000

I have over $3000 in savings but I don't want to pull any of that money for travel (yet). My savings are for home or pet or human or car emergencies* and I want to leave them for those purposes until those responsibilities are no longer mine.

So that's my first task - Save $3000 to open my new accounts and begin earning money on my money (every penny helps!). Of course I decide to do this in the worst economy, after my salary has been cut and right before the holiday season. But if I can save money with all this going on, then it'll just get easier from here.

Spending cuts (how I'm going to start living a more frugal life)

  1. No high speed Internet at Home - I have a Sprint card and DSL at my office so it was over kill to begin with and easy to let go.
  2. Cable TV - This one is going to hurt more but I'll get over it. I can watch at my parents' house or at the gym (it may help me get there more!).
  3. Eating Out - I eat out a lot for networking purposes and a lot for convenience as well. Breakfast @ $5/day = $25/week = $1300/year. I don't eat out breakfast every day but pretty often so that will be a huge savings. I'm going to limit my lunches and dinners - those will be harder but necessary.
  4. Shopping in my pantry - I love to cook so I'm fine with cutting out my expensive restaurant meals but I'm not much better at the grocery store. I'm the queen of standing in my kitchen, looking at my full refrigerator, saying "there's nothing here to eat". I'm sure I'll be telling stories about my progress in this area.
  5. Non-Necessity Spending - shoes, purses, clothing, home decor, etc. I've got a lot of stuff around here... I need to trade, sell, give away or barter some of it to help me achieve my dream. I've already been selling some old clothes at a local consignment store so I'll continue, maybe add some ebay selling, and continue to declutter my life.**

*Such as my car not cranking this morning, keep your fingers crossed that it's just a need for a new battery as we think.

**Some of it will be hard to part with, as I decorated my Christmas Tree this weekend, I loved pulling out my decorations plus I have some nice things (ie. china, crystal, etc.) which were gifts and will have to be stored. That may be another cost I need to factor in my budget.