Retire Early Lifestyle

RetireEarlyLifestyle.comThe last couple of days I’ve had the pleasure of visiting with Billy and Akaisha Kaderli who are exploring Panama.  They retired about 25 years ago at the ripe young age of 38 so they could spend more time traveling overseas.   Instead of settling on one location, they prefer to explore many different corners of the world.  They spend time in Guatemala, Mexico, Thailand, and explore other countries like Panama, Ecuador, Nevis, Belize, Vietnam, and more.  They usually stay in each location as long as a tourist can stay without getting a residency visa.

Billy and Akaisha do have a home base in Mesa Arizona but you will rarely find them there.

So, how can they afford to retire early and travel so much?

Before they retired in 1991, they reduced their expenses so there would be more money left over for investing and to pursue other interests while they were still mentally and physically flexible. That’s good advice!  Many people wait too long to retire and their health has deteriorated after many years of working at a stressful job.

I saw that in 2008 when I went on a 21-day cruise around the horn of South America.  Most of the cruisers were over 65 and half of them were not able to get off the ship when we were at ports.  Their health was so bad that they could barely get around.  Living a health lifestyle with less stress can prevent this of course.  So can retiring early.

Instead of working 50-80 hour weeks and never having time to travel, Billy and Akaisha started investing in assets which would produce enough cash flow to support their dream lifestyle.  It didn’t take much!  They live comfortably on less than $30,000 a year  — that includes medical costs, airfares to distant locales, and housing and living expenses all over the world.

We’re not alone,” said Billy. “There’s a whole group of us running around the world out there, doing this.”

Simply put, they were able to retire early by rearranging their priorities!  You can too. 

They were both willing to try something new, ignore the negative reactions of relatives and friends who said it wouldn’t work, and adopt a simpler, less-consumption-oriented lifestyle.  They’re adventurous even in their lodging choices: they often housesit, or they might take a long-term rental or stay in a hotel room with a kitchenette. They visit the U.S. once or twice a year. Currently they live in Panajachel, a town on Guatemala’s Lake Atitlan.

Global travel has advantages they say,  “Such as the option of meeting new people from other states and countries, the possibility of personal growth, the ability to live a simpler life without the stress of watching utility and fuel bills climb. Not that living overseas is a panacea, life always has a way of giving us challenges. But those who have made the choice to live outside the states in friendlier climates with manageable costs always say how they feel a burden has been lifted off their backs and how, if they had known how pleasant it was to live elsewhere, they would have made the change sooner.”

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Billy and Akaisha’s advice, “If daily costs seem out of control for you, if you have had it with the weather or if you just feel that a change is due, moving to a low cost country such as Thailand, Mexico, Central America, or the Philippines could hold some special appeal.  Many have made this move and have paved a path.  (Panama would certainly be on that list too!)

RetireEarlyLifestyle.comMake your dream a reality!   Early retirement is about getting out of the rat race so you can experience life.  It’s not a vacation, it’s a lifestyle.

In their 2011 book “Your Retirement Dream Is Possible,” the Kaderlis describe a 7-step process behind their plan for early retirement. Here’s a rough guide to their strategy:

1. Assess your finances

To gauge your ability to retire, you’ll need to figure your net worth, the Kaderlis said.

If you own a house, estimate its value via, or a similar site, and then subtract your mortgage debt.

Add in the value of your retirement, investment, savings and any other financial accounts, plus the value of your cars, jewelry, furnishings and other items. Subtract any other debt.   Hold on to this figure — you’ll see why below.

2. Track your spending

Start writing down (or entering into a computer) every dollar you spend.

“It is imperative to know how much you are spending, not only per year, but also per day,” the Kaderlis write in their book.

“After a month or two, you will discover where to reduce expenses. Within a year, you’ll be in control of future spending,” they said. “This simple routine will start you on your way to financial freedom.”

The Kaderlis employ a couple of systems to track spending. First, they make note of each expenditure. Then, each morning, they enter the previous day’s spending into a running total in their spreadsheet (or, if they’re without a computer, into a notebook), and divide that total by the day of the year. For example, on Jan. 1 they divide by 1, on Jan. 2 by 2, etc. That gives them a daily average.

They also keep a running total that includes the previous year, such that Jan. 1 of the second year is day number 366 (so they divide the day’s total by 366). That gives them a second daily average. “The ‘year +’ figures are always more stable, because they contain more data,” they write. “This is exactly the point: that stability helps to relieve stress.”

The combination of knowing their net worth and daily spending inspires confidence in their finances: Every day, they track the percentage of their spending to their net worth. That way, they can quickly see whether they need to cut back.

They follow the 4% rule: spending about 4% of their portfolio each year, with adjustments as needed.

“We spend what we want to, and then we track it to see what percentage we’re spending,” Billy said.

Also, every couple of weeks or so, the Kaderlis enter their expenditure data into a computer program that allows them to categorize each expense — a task that takes about an hour — so they can easily see whether, say, their restaurant outlays have gotten out of whack.

“The longer you keep track of current consumption,” they write, “the more confident you’ll become of your future spending habits.”

3. Save, and then save more

Once you’ve started to take control of your spending, it should be easier to see how to reduce outlays and add to savings. A general rule of thumb is to save 10% to 15% of your gross income each year, but the precise figure will vary depending on your age, current savings and goals.

Don’t forget that your expenses change when you retire. Holding down a job can add many costs to a family’s budget, including commuting costs, car maintenance, new clothes, lunches out, dry cleaning costs and more.

Also, don’t forget that eventually Social Security will provide some monthly income.

4. Invest wisely

The Kaderlis invest in the stock market via index mutual funds. Even through the financial crisis, they were able to collect retirement income from their investments — though they did go over their 4% rule at times. ( I invest in real estate – it does not take long to get to $2,000 to $3000 a month in cash flow which will completely support your retire early lifestyle overseas)

“Our portfolio took a hit, no doubt, like everybody else’s did,” Billy said. Still, “based on our spending habits and history, it didn’t affect our lifestyle.”

During the downturn, they shifted their portfolio into exchange-traded funds and out of traditional index funds, so they could trade in real time — a boon for people living off their investments.

“We’re big believers in index investing,” Billy said. And in the power of the stock market: “The S&P 500 SPX, +0.46%  has averaged over 8% a year plus dividends. That’s through the dot-com bubble, the Great Recession, the housing bubble — and it’s still performed 8%.”

5. Put peer pressure into perspective

Early retirees have to resist pressure to spend. They also will face naysayers. “A lot of the people who said it can’t be done, they want everything secure, everything guaranteed,” Akaisha said.

Naysayers will include in their budgets a replacement car, roof repairs, long-term-care costs, she said. “These people are just so afraid. They need to have every single guarantee — or people like us are liars,” she said. “It’s actually very doable.”

Relatives may exert some pressure, too. Akaisha’s mother, for instance, felt like she would never see her daughter — but those feelings soon changed. One reason: With their newly flexible schedule, Akaisha and Billy were able to visit for longer periods.

“We can spend a month with our families, not just a dinner,” Billy said. Plus, Akaisha was able to provide end-of-life care for both her parents.

6. Choose simplicity

Their low-cost lifestyles are not about denying themselves things. Instead, they find happiness in experiences.

“Stuff, which ultimately gives little meaning to life, is a sinkhole on your road to financial independence,” the Kaderlis write. They offer some resources for living simply on their website.

7. Keep your eye on the prize

Every time you get sidetracked by spending a little bit more, succumbing to peer pressure or choosing not to put extra money into your retirement funds, you’re literally delaying your retirement date by weeks, months or perhaps even years

8. Health insurance

For years, the Kaderlis bought insurance through a U.S. provider. “But we did so much international travel — you can’t fly back for every little thing that goes wrong — so we found ourselves using medical tourism as a matter of course,” Akaisha said.  ( A doctor visit is about $10 in Panama and an emergency room visit is usually less than $150)

As a result, they dropped their U.S. policy about two years ago. Now, when they travel to the U.S., they purchase a traveler’s insurance policy, available for a specific period of days or weeks, to cover catastrophic care. Everything else, they pay out of pocket in whichever country they find themselves.

What about the possibility of needing long-term care? “In a foreign country, you can have nurses and doctors come in to see you. You can hire someone to do your shopping. We don’t have to spend $70,000 a year,” Akaisha said. “In Mexico, there are lots of places you can live in with Wi-Fi, maid service, your meals included, laundry — for $1,500 or $2,000 a month. That’s reasonable.”

 Would you like to retire early so you can move to a foreign country or travel the world? 

Learn more about financial independence and retiring early at Billy and Akaisha web site,   Check out their affordable books too!

Jackie Lange

Jackie Lange is the founder of Panama Relocation Tours and lives in the highlands of Boquete Panama. She has helped thousands of people relocate to Panama.

Reader Interactions


  1. Stephen Cohen says

    Wow, this article resonated with me big-time. With so many events taking hold of the people who I love around me I am beginning to see that conventional pre-conceived ideals of living don’t have to be my only option? The impact is magnified having lost my Father-in-Law yesterday. And the specter that life does not have a practice run! This is the one and only chance to live the life I choose… At 58 yrs old and having graduated my 2- kids from College earlier this year the notion that I have choices to select from is thoroughly invigorating! Thank you sooo much for stoking the flames of possibility! I will be exploring my internal landscape to identify what my external landscape should look like.
    Many Thanks for your inspiration!

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