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Messages - R32

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Travel hacking / Travel Hacking Tips for Non-Credit Card Users
« on: August 18, 2021, 12:04:00 AM »
Although we do use credit cards, we live in a low-cost SE country, and likely wouldn't be able to make the $2-5k minimum spend in a 2-3 month time period in order to claim the initial mileage sign-up bonuses.

What are some non credit card travel hacking tips/suggestions? As of now, I've come up with buying miles at a discount from the carrier (i.e. special promotions) or private party, and signing up for air carrier email blasts that might provide promotions on business class flights. I'm particularly interested in business class travel. I've also downloaded the Secret Flying app to get access to error fares and special flight specials not advertised on airline websites. Unfortunately a lot of paid flight deal websites only analyze flight deals from the USA and/or Canada, not for international flights originating from Asia.

Since we are a FIRE family, we are relatively flexible with dates (i.e. shoulder or off-peak seasons) and destinations. This will be a very important part of our lifestyle for the next 50+ years, so I'm looking to try and optimize this part of our budget as best as we can.

Expat life / Rent vs. Buy a House Decision for FIRE Families
« on: August 17, 2021, 11:54:01 PM »
I'm interested in how the rent vs. buy decision and variables are different for FIRE families living abroad looking at a primary residence. If you're drawing down on average 4% of your investment portfolio per year (plus inflation), would you analyze the rent vs. buy simply if you can rent for less than 4% of the equivalent purchase price of the house, then rent, otherwise buy? Or are there other factors or ratios we should be considering?

My wife and I currently rent a 3 bedroom house for around $730 USD including lawn care, pool maintenance, and typical repairs to the house. To purchase a comparable house, it would cost around $240k USD plus closing costs. However, we would then have to take on the joys (costs) of ownership (i.e. taxes, insurance, repairs/maintenance, etc.).

We live in SE Asia in a country where the property market is highly illiquid as there is a glutton of supply without much demand. Refinancing costs are relatively high (~5-9%), so borrowing against the house would be pretty expensive if you needed access to the equity.

We don't know if we will live here full time for the rest of our lives (currently in our mid 30s), but it could serve as a "base" camp as we travel the world (post COVID) and would give us the ability to drop in and out part time as desired.

I've attached rough 2020 numbers for our situation. We won't owe a federal tax obligation because we meet the physical presence test for FEIE and our ordinary W2 income is $73k. So after $6k in 401k contributions, what the output is telling me is that I would be able to either Roth convert $30,800 or capital gain harvest up to $37,800 without paying any taxes? I'm having a hard time understanding why it's those amounts based on my inputs (i.e. I can't reconcile or back into those numbers to validate the calculation).

Thank you for the clarification - this is my first year living abroad as an expat and trying to optimize our financial situation. Thank you GCC and forum community for the wisdom, education, and encouragement.

How do you calculate the maximum amounts in a year you can Roth IRA convert and capital gain harvest without paying any income tax on either of these events?

When we FIRE in five years, we will primarily live off cash reserves and withdrawing from our existing Roth IRA accounts and/or after-tax brokerage accounts. We will have about $225k in our Traditional IRA accounts.

My wife and I file married filing jointly status and no kids. Please let me know if you need any more relevant information in order to answer my questions effectively. Thank you!

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