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If the pandemic these last 2 years has taught us anything, it’s that life is short. It’s a silver lining reminder that I think we all needed in some way, and as tragic and sad as it’s been to lose loved ones or know someone who did; tomorrow isn’t guaranteed so you might want to start living today!
That’s how this FIRE movement couple thought about life when they decided to retire at the young age of 38!
Billy and Akeisha sold their major assets and invested that money. Because their end goal was to retire early or FIRE as it is known in modern-day. And after 25 years of living in Mexico, they’ve never regretted that decision.
So, if you’re dreading the idea of working until you are 65 or later, you’re not alone. Life is short. And here’s what you can do to retire early and live your life on your terms. But first, let me explain what the FIRE movement is all about.
What is FIRE?
In a nutshell, the premise of FIRE is to cut living expenses to the bone and save like a maniac for a few years until you have enough savings and investments. That way you can live off your dividends and continue to live your life wherever you would like. Fire stands for Financial Independence Retire Early.
You may have seen this movement on several Youtube channels or blogs. And the message is almost always the same- tighten your budget, reduce your expenses, and save as much as you can from your income. Invest it, watch it grow, don’t touch it, and once you hit a calculated amount in dividends per month you can then retire.
Now, imagine that you have a job that pays you 55k/year in the U.S.
And your expenses are around 40k/year. And maybe you’re late to start saving- because life happens. Saving about 15k a year might not be enough money for you to retire in 10 years assuming a 7% return on the market. Because in the U.S., your expenses are 40k a year. And even if you could reduce your expenses to 30k a year you still wouldn’t have enough money in 10 years to retire early. Not with the current rate of inflation.
And that’s exactly why so many are looking into other countries for a solution. Particularly, Mexico. Because living in Mexico can reduce your cost of living by up to 60%, and a lower cost of living means you can retire sooner! See where I’m going?
How Much Money Do You Need to Retire in Mexico?
Mexico is full of rich culture, amazing food, great weather, laid-back and friendly people, and natural beauty. It’s a diverse country that has deserts, mountains, beaches, forests, lakes, and everything in between. And fortunately, for many, it is also a much lower cost of living than the U.S. or Canada.
So how much money do you actually need to retire in Mexico?
The answer: it depends. You can easily find a 2 bedroom 2 bathroom apartment in Playa del Carmen for under $600 USD/Month. And if you’re not particular about having the beach within a 5-minute walk, you could probably find an apartment for less money. But it all depends on your budget and lifestyle.
But if you’d rather live in the central highlands, many have found rentals in the $600-$800 USD/Month range with the added savings of not needing an air conditioner!
In fact, the average Mexican household lives on less than $2000 USD/Month. And the typical household in Mexico is 4 people. I know several couples and single people living in Mexico who left the U.S. in search of a better work/life balance. Their expenses before were well over 40k a year, and moving has given them a new type of freedom. Their expenses now are $1500 USD/Month or less! That’s a 50% decrease in their cost of living. But the life they gained is priceless!
Here are some example comparisons:
| MEXICO | USA |
| 3 DAY TRIP- LODGING, TRANSPORT, MEALS $450 | 3 DAY TRIP- LODGING, TRANSPORT, MEALS $800 |
| DINNER FOR 2, WINE, AND APPETIZER $65 | DINNER FOR 2, WINE, AND APPETIZER $120 |
| LUNCH AT FAST-CASUAL REST. NO DRINK $11 | LUNCH AT FAST-CASUAL REST. $5 |
| 45 MINUTE TAXI RIDE TO AIRPORT $20 | 45 MINUTE RIDE TO AIRPORT $60 |
| 2 LBS OF PRODUCE- VEGETABLES AND FRUITS $6 | 2LBS OF PRODUCE- VEGETABLES AND FRUITS $15 |
This Family of 4 Lives on Less Than $2k/Month!
April is a lovely lady I met while doing some research on a San Cristobal Facebook Group. Her charm and friendliness stood out, and we quickly became virtual friends. April, her husband and 2 young kids all live in San Cristobal de Las Casas. Because San Cristobal is so cool year-round, electricity is generally very low. April and her family of 4 are all able to live on less than $2,000 USD/Month!
Below are some of her monthly expenses: (all in USD)
- Rent: $420 USD/Month (fully furnished and including all utilities)
- Gas: 13 USD/Month (Used for cooking)
- Cellphone Service: $10 USD/Month
- Eating Out: $100 USD/Month
- Water: $20 USD/Month
- Groceries: $200/Month
In our chat, April told me how she hated leaving her kids for hours a week only to make ends meet. Moving to Mexico gave her back her freedom and much-needed time with her young children. Even though April isn’t retired yet, she sets her own schedule and only works the hours she needs to. Living in Mexico has significantly enhanced her life!
How Russell Lives On Less Than $1,000/Month!
If you ever get a chance to meet Russell in person, make it a point to become his friend. Russell always had a dream of being a writer, but his company in Florida demanded a lot of his time and energy. During the pandemic last year, he finally left the race to find his sunny paradise in Mexico and fell in love with Huatulco.
Russell lives very comfortably on his social security alone, including entertainment, dining out, and beach trips. Most months, his expenses are less than $1,000 USD/Month. Russell doesn’t drive, so he doesn’t have gasoline or car maintenance to worry about. You see, most of Mexico is built into walkable areas. Everything you need is usually a short walking distance. And if you need to go further, Taxis are usually less than $5 USD.
He now writes in his free time, has been published on International Living, found love in Huatulco, and is happier than ever before! Russell got his time and freedom back.
Here are some of his expenses:
- Rent: $275 USD/Month-1 bedroom fully furnished apartment
- Groceries: 225 USD/Month
- Taxis: $20 USD
- Laundry: $20 USD includes folding
- Entertainment: $200
- Electricity: $10/Month (he doesn’t use his A/C much)
Annette Retired at 52 And Has A Life She Loves
Annette is a pillar of her community in Ajijic. She helps everywhere she can. Spending her time and energy rehoming stray dogs in Mexico, and providing new expats in the Lake Chapala area a friendly resource they can count on. Annette is living the life she loves.
Annette’s dream was always to retire early. As a couple, she and her husband decided to bootstrap their lifestyle in Texas, save as much money as they could and cut back on their expenses. At the age of 52 years young, she was able to hang her hat and move to Mexico for a simpler life. Volunteering is in Annette’s blood. She’s one of the kindest people you will ever meet, and now she has the freedom to do it on her own terms and without asking anyone for time off.
Her two elderly parents have a live-in caretaker and nurse. She can afford a live-in maid, a gardener, and eating out several times a week. Something she wouldn’t be able to afford in Texas. Moving to Ajijic has been an enriching experience for Annette and her family- who are all living together and doing it lavishly.
Where Do You See Yourself In 10 Years?
And these stories aren’t unique to April, Russell, and Annette. You’ll hear stories like these all over Mexico. So many people have discovered that there is more to life than the never-ending rat race of the U.S. And that they can truly have a better life for less in Mexico.
So where do you see yourself in 10 years? And if the answer in your head is dreading those fluorescent lights at the office, the long hours worked just to get by, or not having enough time to do the things you want- like volunteering or spending time with your kids.
What would you do with the extra time? Would you finally start that workout routine? Would you travel and explore? Or maybe you’d give back your time to others? Then it’s worth your time to decide how making a move to Mexico can impact your life. Because tomorrow is not guaranteed.
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