3 Months in Europe, Income Taxes and Early Retirement
Ohh Early Retirement, you make every day feel like a Saturday: the day of freedom, the day of sleeping in, the day of doing whatever one’s precious heart desires. Do you feel like going for a bike ride? Maybe you’ll go to a Pilates class, do laps at the local pool, or if you’re really up to it: lift some weights! Do you have any lofty dreams or life aspirations? Maybe indulge yourself in a few puffs of some legal cannabis, play some wonderful music and think about it.
Recommended lofty dream: Make yourself an avocado-kale-banana-berry-protein powder smoothie (ahh, so delicious and healthy)!
Or, if your preferred lofty dream is doing tedious data entry tasks, you might be excited about doing your income taxes!
Income Tax Details:
We finally got around to finishing our 2017 income taxes and if anybody’s interested, here are the highlights:
Gross Income: $46,500
$6,500 – Rental income from our various tenants while we traveled for five months of the year (we went to Canada again over Christmas!)
$19,500 – Salesforce Remote Contract Work (I stashed pretty much all of this into a Vanguard Solo 401(k) plan to avoid affecting our ACA subsidies – if anybody wants to know more, make a comment and I’d be happy to share details!
$20,500 – Airbnb revenue
Last month we hosted our very final Airbnb group. Hurray! Seven people slept in our basement for two nights. They paid around $780 to Airbnb, of which $99 was Airbnb Fees, $80 was “Tourism Taxes” for Buncombe County, and the remaining $595 was paid out to Amanda and I as taxable income.
I’m still in disbelief with how lucrative Airbnb is in Asheville, but we’re calling it quits. It’s been pretty easy money, but we want our privacy back and full use of our home, so we won’t be renewing our $200 “Asheville Homestay Permit” from the city this year. If you’re interested in more of our Airbnb stats, you can check out this previous post where we shared more detail: Making Money With Airbnb in Asheville, NC
Early Retirement is all about Spending, so I can also share the highlights of those 2017 numbers here: $32,620 for the year, an average of about $2,720/month.
Ignoring the income we made, spending for the year was about 3.6% of our portfolio*. Well under the generally acceptable 4% FIRE spend rate. Plus as you saw above, we actually added to our wealth last year, so we’re feeling pretty good. Time to take another trip??
*Being conservative-birds, for calculation purposes we don’t include our paid-off home in our “portfolio” calculations. It was worth about $270,000 two years ago when we bought it and so as not to speculate on today’s prices, we ignore it. This would obviously bring our % spend down even lower.
Planning for an 80-Day Trip to Europe:
We’ve churned so many credit cards and now have more Chase Credit Card “Reward” points than we can count. Resolution: we’ve used some of them to book flights for an 11-week trip to Europe – Lisbon (1w), Barcelona (2w), then Italy (7w), and finally the UK (1w)!
Hurray for Europe!
Amanda took a 6-week trip to Europe with her sister back in 2004, but this will be my first time – I’m excited! We used Airbnb to book apartments in all of our locations reasonably close to public transportation. We listed our home on craigslist and found a nice couple from Kansas who want to check out Asheville for a few months. They’ll be paying us $1450/mo in rent while we travel, which will help us cover our travel expenses and works out perfectly.
I might need to do a bit of work while traveling, but my remote contract work is pretty flexible and is usually less than 5 hours per week. We also switched our phones over from Republic Wireless to Google Fi so that we’ll have smooth and affordable international cell coverage as we travel around. Amanda pays for the full Google Fi plan ($25/mo) and I just have a data SIM in my phone and use Google Voice as my primary number – it’s a pretty sweet setup!
Is Europe truly the Utopian paradise that I’ve been lead to believe? Are homeless people only a myth, and will the cities be filled with wonderful metro trains, glorious bike lanes, beautiful buildings and rainbow unicorns!?
Most importantly – are Portuguese alley cats as friendly as Catalan alley cats? Or are Italian cats the friendliest of all!?
I’ll leave you with this important map: How do you say “cat” in Europe?
