Make new friends, but keep the old. One is silver, and the other gold.
So says the iconic scout song I learned as a Brownie, too many years ago to count.
The sentiment is true. The past four years full-timing in The Epic Van has been a testament to this theme. We’ve driveway surfed from Washington to California to Kansas to New Orleans, looking up old newspaper colleagues scattered to the four winds. We’ve broken bread with relatives near and far. And we’ve camped with and made fabulous new friends on the fly in Idaho, Montana and California.
By Tom Nichols
Year four of our financial adventure gyrated around the wealth effect. Boosted by investment gains since we became nomads, we traveled on growth income while our original nest egg was preserved. What could be sweeter?
We were cruising with the stock market winds at our backs in 2018, lulled into complacency by the wealth effect. After almost four years of early retirement, we felt more financially secure and, therefore, more relaxed about spending. Why not splurge a little, say travel without The Epic Van, or indulge in a few more restaurant outings?
For the first time since our working days, we flew again for pleasure, first to Mexico with Nate for a New Year’s 2018 vacation, and then to Illinois for a family reunion in July.
It turned out we had travel expenses for good times and bad. During a planned Epic Van visit to South Carolina, we wound up helping my sister, Ronda, deal with a medical crisis. We paid for Nate to fly out and visit while we helped move Ronda and her husband, Ray, to an independent living complex. Judy’s mom also had medical issues, which caused us to cut short our volunteer commitment at Big Sur. It also meant rerouting our plane tickets for the Illinois reunion from California to Phoenix, which cost us dearly.
We knew the mix of pleasure and emergency spending would break our original $60,000 a year budget or even blow our revised budget, which is $65,000 a year.
Bottom line: We spent $71,796 last year, which put us a bit above the median-income life we vowed to live in early retirement. For comparison, we spent $62,765 in 2015, $69,490 in 2016, and $66,024 in 2017.
As I have reported in each of the last four years, just about all our over-budget spending is on dining and entertainment. Record spending this year included plane tickets, hotel and car rentals, a handful of $150-plus meals and a few more hard-cover books.
Our monthly total skyrocketed to $1,130 a month. For comparison, we spent $550 a month in 2015, $740 a month in 2016, and $792 a month in 2017.
We budgeted $400 a month for dining and entertainment in our original budget, imagining we would be living and eating in remote campgrounds most of the time. But we’ve spent more days in towns visiting family and friends than expected, and when we do, we spend more money. When we do camp in remote spots for most of a month, we spend about $425 a month on dining and entertainment, only slightly above our initial $400 estimate.
Thankfully, just about every other spending category we set four years ago was more realistic.
The cost of operating The Epic Van (loan, fuel, vehicle and “house” repairs, insurance and license), was $1,695 a month in 2018. We budgeted $1,600 a month in our original $60,000 budget.
We will be spending more for RV insurance in 2019, up to about $200 a month in total, because of a speeding ticket issued on the way out of a lonely town in eastern Washington. If you travel backroads through hundreds of small towns each year, it will probably happen to you. We won’t be out of the penalty box for higher insurance rates until 2020.
We also hit a spending record, $500 a month, in health copays and deductibles for routine diagnostic tests (endoscopies, yea!). It is the only spending category completely beyond our control. Our Obamacare plan has a $6,500 annual deductible for each of us.
Phone costs, too, are going up. We replaced iPhones purchased in 2014, and are paying for them in installments.
Blogging expenses rose in 2018 because of a hack, which required professional help to clean and restore New American Nomads. Postage costs for mail forwarding and gift giving are higher than we estimated four years ago.
We’ve updated our budget grid to show spending in 2018 and four-year averages in all categories.
As 2019 begins, we are over the hump in our six-year early retirement financial adventure. We began life in The Epic Van as 59- and 58-year-olds. Judy, 63, is less than two years from getting steady income from a partial newspaper pension, based on about 15 years of employment at The Arizona Republic.
With my newspaper pension, also based on 15 years at The Republic, and Judy’s Social Security benefits starting in 2021, we will have additional income to buy a modest traditional dwelling again, if we choose or are forced to by health problems.
In 2018, our nest egg soared to new heights along with the S&P 500 index, which hit an all-time high. The index was up about 10 percent in October, before falling sharply. At year end, the S&P was down about 6 percent. The forecast for 2019 is for slower global growth and the possibility of recession in 2020.
So, how’s the nest egg holding up?
Well, as of Dec. 31, the nest egg, which had been holding steady for four years, was down about 8 percent. That includes the loss of our Obamacare subsidy for health care in 2017, which we found out about in 2018.
Letting Judy know about the “repayment of Premium Tax Credit,” was the least pleasant conversation of 2018. You can avoid my mistake by taking capital gains before you retire instead of taking them when you are eligible for Obamacare.
If you want to get deep in the weeds, I will describe the linkage between our retirement income sources and our Obamacare costs in my next post. Put simply: A couple must have less than $65,840 in adjusted gross income to avoid an expensive tax credit repayment.
Obviously, the wealth effect becomes the less-well-off effect when the stock market falls. We are scrapping our air travel plans and splurge restaurants this year and retreating to a $65,000 spending target.
As reported in year three, if you want to live on the road for $60,000 a year or less, limit your vehicle costs (loan, fuel, insurance, license and repair) to $1,250 a month, or 25 percent of your budget. Our Epic Van costs are 32 percent of our original budget.
You’re going to need three-quarters of your budget to pay for essentials, enjoy life on the road with old and new friends and see some attractions along the way. That is $3,750 a month for groceries, dining and entertainment, medical care, phone, household storage, clothing, blogging costs, camp fees, taxes and gifts.
Finally, a word of thanks to family and friends for your driveways and hospitality, which makes our middle-class nomadic life possible. Your material gifts are not included in my annual financial report, but they make our wandering life sweeter.
My everlasting thanks goes to Judy’s mom, Jeannine, who shelters us in winter with a bedroom, shares her kitchen and lends her Subaru to us for getting around Scottsdale when we are parked. We could not do it without her.
As we reflect on the cost/benefit ratio of our early retirement experience, we both declare success. Our travels have left us astronomically richer. Even if our nest egg were more deeply depleted, it would all be worth it.
|Expense category||Original budget||2018 monthly average||Four-year average|
|The Epic Van loan payment||612||612||612|
|Health insurance (includes dental)||620||154||559|
|Prescriptions procedures and copays||100||500||199|
|Phone-data (for 3)||285||344||314|
|* Excludes Obamacare premium tax credit repayment|
|* Full fee activated when in Scottsdale|
There is an odd rhythm to nomadism, a dance, a feeling of slight disorientation as you get to know and embrace each new spot you call home, even if only for a few days.
Now, in year four of our journey in The Epic Van, we seem to have gotten better at it, reaching a comfort level we didn’t have in the beginning, when each new place felt wildly exciting, exotic and fascinating, but a little foreign.
If I haven’t mentioned it before, Tom has become a true tree freak.
On hikes, he frequently stops to gaze upward at branch arrays, set his hand on a trunk’s bark, count the number of leaflets in a bunch and test the spikiness of needles against his fingers.
He takes photos of the whole tree, the leaves and the bark, and then compares them to photos and descriptions in his tree book when he returns to The Epic Van.
He’s so thorough that I’m beginning to know the difference between an Engelmann spruce and a limber pine.
And so, when we were at Great Basin National Park in eastern Nevada this week, we headed for the ancient Bristlecone Pine Grove on Wheeler Peak.
At Arches National Park, we scrambled over clusters of rock to walk along a sandstone fin with sheer sides, heart-stopping dropoffs and amazing views. I felt like I was queen of the world.
At its sister-park, Canyonlands, we looked out over miles of canyons, spires, and cliffs, cut by the Green and Colorado rivers. I felt small and insignificant.
And both parks, created from eroding and ever-changing rock forms, made me think about the impermanence of things that seem permanent.
When I think of Big Sur, it is the wild radish I will always remember.
The crunch of it in my mouth, similar to the texture of a radish, but a milder, sweeter flavor.
A wilder flavor.
You know I love The Epic Van. And I love the company that makes it, Roadtrek.
The first year we were on the road, we went to the Roadtreking Photo Safari near Yellowstone. It was a gathering of my kind of people. We still have friends from that first meetup.
Now, three years later, we just finished our second Roadtreking Photo Safari, this one near Glacier and, once again, it was a blast.
My personal thank-you list is looooong. So, here goes. Thanks to:
The Florida Everglades, the River of Grass, feels fragile, like any moment a hurricane will wipe it off the map, or humans, after decades of abuse, will finally kill it, or invasive species will forever alter it.
The longer you’re there, the more fragile it feels.
By Tom Nichols
I never heard any of my outdoor-loving friends in Arizona mention Grand Mesa National Forest. There are so many wonderfully eroded canyons and expansive mesas in Utah and Arizona, so many famous peaks and alpine parks in Colorado’s Front Range, it’s little wonder that Grand Mesa National Forest, the nation’s biggest tabletop mountain, is never mentioned.