Register ← Return to Sign In or Edit Profile

Don’t Save For Long-Term Travel, It’s Not Worth It

by Globetrooper Todd | 25 Responses
Retirement Travel

For many years, say 15 or so, I was on a path of working hard with the intention of retiring early to travel the world. Long-term travel was essentially my end goal, and I was going to work harder to make it happen sooner.

Sound familiar?

This plan made a few assumptions:

  • Long-term travel requires more money
  • Long-term travel disrupts careers
  • Long-term travel is worthy of a dream

This couldn’t be any LESS correct.

Assumption #1 – Travel Requires More Money

Woohoo! 20 Million Dollars!

I asked Lauren last night,

What would we do if we came into lots of money, say 20 million dollars.

We were stumped. We love travel and we love building startups, but we’re already doing both. So we had to think harder.

I’ve got it! We’d stay in a nicer place! We could move into a better apartment for our remaining week in Chiang Mai before heading to Berlin.

So instead of our current rent of $70/week, we’d pay $140/week. Why only $140/week? This is Thailand, not Monaco. A nice place in other cities would certainly cost a lot more, but right here, right now, if money were no issue, we’d spend $70 on a nicer apartment for the week.

Great! $70 down, $19,999,930 to go.

What? You Don’t Have a Spare $70 Right Now?

Of course we do. So that answer sucks. Back to the drawing board.

Maybe $20 million would give us the flexibility to live in more desired cities. So I said to Lauren,

Instead of living in Bangalore, Bangkok and Buenos Aires, we could live and build startups from New York, Paris and London.

Uh oh, hold the phone. We were just in New York, and compared to the big cities of India, it was a bit of a bore. No cows walking down the street, no villagers crowding around to watch me get a shave, and just not that interesting. So if we moved to New York, it would mean the $20 million is hampering, not improving, our travels. Boo! Back to the drawing board.

A Sad State of Affairs

Wow, I’ve never been in such a state that $20 million wouldn’t change much. I’d certainly invest the money, maybe buy a new backpack (which I totally don’t even need), oh, and I’d upgrade my MacBook (which I’m planning to do in Berlin anyway). But otherwise, we’d keep building startups and traveling at a similar pace. That’s what we like.

There goes assumption #1.

Assumption #2 – Travel Disrupts Careers

What About Our Careers and Saving for The Future?

Oh, you mean the future as in retirement, when you plan to travel the world. Well, there’s some recursive logic. You’re traveling right now, silly :) Okay, so what about the future when we can’t travel anymore and need to pay for children to enter school.

Guess what? After 14 months on the road, Lauren and are now making more money than we did when we both worked full-time in private equity.

Yes, Private Equity, one of the most prestigious and difficult-to-enter areas of finance. Do you know how many years we spent at university to get those jobs? More than our 14 months on the road, that’s for sure.

But I’m Different, I Love My Job

I loved my job too. I never woke up and didn’t want to go to work. At least not in my last couple of jobs. But I was living a lie.

In private equity, I was investing in businesses and advising very successful business people on how to improve their businesses. The problem? Well, neither me, nor anyone else at my firm, had EVER built a successful business. Let’s be honest, what a joke!

Now, on the road, Lauren and I are building our own products and have our own customers. This is real business. Keep in mind, it was only once we really got into financial trouble on the road that our brains kicked into overdrive.

While long-term travel did disrupt our careers, it led to much better ‘careers’.

There goes assumption #2.

Assumption #3 – Travel is an Event for Later

Long-Term Travel is an Education, Not an Event

Most of us go to school from the ages of 4 or 5 and get as much done as early as possible so we can benefit from lessons learned and make more of our lives.

But if travel is also an education, why do we defer it? That would be like deferring school until 65 and working in a factory from the age of 5.

On top of everything else, in 14 months we’ve learned how to make more money than ever with our very own ideas. We’ve also learned to be independent and better deal with change and uncertainty. Compare this to most MBAs who’ve never had their own customers, but call themselves business people.

So given that the lessons from long-term travel have such an important and long-lasting impact on life, it makes no sense to defer it.

There goes assumption #3.

Summary

Travel now. Hit the road and don’t look back. You absolutely won’t regret it. :)

Posted in Featured, India, Thailand, Travel Hacking, United States | September 4th, 2011

25 Responses to Don’t Save For Long-Term Travel, It’s Not Worth It

  1. Hi Todd,

    How much does someone who works at private equity make on average?

    • Hey Julian,

      It really depends because part of total compensation is what they call carried interest. Basically, if you sell a business for more than you bought it, the partners of the firm share 20% of the proceeds. So for people who get carry, their salary is typically lower. (I got carry.)

      I’d say the absolute lowest salary for an analyst (lowest position) is $60k. It can go up to hundreds of k depending on the firm, position, performance, etc. Carried interest can put it into millions, depending on performance.

      The big issue for me is that PE is just about ‘clipping the ticket’. It’s about doing a deal to invest in a business, adding lots of debt, making lots of acquisitions, and selling the business for more. PE doesn’t add tangible value, it extracts value from the people who create the real value. The industry won’t agree with that statement, of course.

      I missed being a part of the story. I didn’t feel proud to say that I worked in PE, except to people in finance, who mostly think it’s the bee’s knees (generally because it’s a little less corrupt and mindless than what they’re doing). Hence, giving it up to build Globetrooper, travel the world, and work on other projects.

      Just for the record (and in response to another comment), we didn’t use any savings from PE to travel. We sold our stuff and just hit the road. We then ran out of spending money, freaked out, and from that we worked out how to be creative and make money.

      The key is geo-arbitrage. You can get by (comfortably) on less than $1k/month in most countries around the world. Interesting countries.

      All the best, todd

  2. 20M is a lot of millions.
    I’d be happy with 1.
    Or half one. Or a quarter one.
    You can travel 3 weeks from USA to EU or the opposite for $1000 all inclusive (I know, I’ve done it, and it wasnt a “poor” travel, and I slept in proper places and none was free, and yes, there was even a recent card)

    So yeah.

  3. Interesting post. Me and my wife just came back from a one year trip. We highly recommend it to anyone regardless of age or career. The hard part is making the decision, the remaining parts eventually fall into place.

    • Good point Paulo. Did you think about staying on the road? Or were you happy to return home? We’ve been on the road for 14 months, but I just have no interest in going home. I miss a few friends (very few), but otherwise I’m happy to think I’ll be on the road indefinitely. That said, we definitely want to slow down. We’d prefer at least 6 months in each city. Maybe even 12.

  4. I completely agree. In that spirit, we are launching a new concept of ‘workation’ = working vacation for people who love so much their work that they don’t want to go on holidays (e.g. entrepeneur). The idea is to spend one month in nice villas in Bali where you can work hard while enjoying life at the same time. Labor & life is so cheap that you can outsource all your chores & still saving money compare to living in main Western cities.

    • That looks really cool Antoine. Let us know how we can help promote it.

  5. Hi Todd, this is a very inspired post. It would be interesting to give an example of what business you have built while traveling and earned more money than private equity job.

    • Hey zghot, thanks for the kind words.

      The first business is this one, Globetrooper. We wanted a more unique business model, but at the moment we rely on advertising. It makes about 40% of our online income. The rest is related to newer and smaller projects that we’re giving most of our focus these days.

  6. How do you manage new client development while on the road. Do you grow solely from referrals, or has your blog proved popular enough to draw new clients?

    • Skype! The comment below yours is from Lily. We’ve never met her, but my partner Lauren called her last week for customer development purposes. In terms of existing clients, we also mostly use Skype. Especially in the travel industry, most people are used to talking on the phone. But for those who only have land lines, calls to most countries are about 2 cents per minute. Which is cheaper than local calls in many countries (for a call under 5-10 minutes).

      I think most people who live outside the US are used to doing business on the phone. Coming from a city like Sydney, which is still 5 million people and quite large in geographic terms, we’re also used to doing business via phone.

  7. Hi Todd & Lauren,

    A very inspiring post, as the other readers mentioned. Having been spending more money recently from travelling in western Europe (Austria, France, Spain) I was thinking yesterday about what the difference is between travelling here and “less” developed places in eastern Europe, Asia and India.

    Looking back, my travels in the less developed countries has been more interesting, exciting, unusual and memorable. I used to think I was a city-girl who loved shiny stores, restaurants and museum, but after these last 10 months, it turns out I love the small towns and places less travelled.

    I used to think this whole geo-arbitraging thing was overrated, but now I actually understand how it’s done. Now, I don’t think I’ll ever be able to go back to the normal life of working, saving, buying a house, working and retiring when I’m 65. I feel like I’ve taken the red pill ;)

    - Lily

    • Hey Lily,

      Great to here you’re not planning to return to 9-to-5. We’d have to stage an intervention if that were the case. Hope everything’s still going well.

      Despite us loving India and other culturally adventurous places, we’re heading to Berlin on Sunday. So fingers crossed. :)

  8. Hi Todd and Lauren,
    Interesting points you make in your article. I think you have done the best of both worlds by getting an education first when you had no real commitments, doing some work and building up some equity and then travelling. If and when you are done doing the sort of travel you are doing you have something to come back to or continue in business but you already have a great start. I think its good that you didnt get sucked into just continuing to work in areas that didnt engage you completely. So proud of you both that you have made such a successful go at your business and lifestyle.

  9. Very interesting.. I am inclined to agree with you!

  10. So one thing which does go up a lot in cost is travel with kids. Instead of two tickets you’re looking at 4, and you need to find some way to keep them occupied while you do work. Then they start getting upset about not having stable long term friendships. To combine travel with having a base stable enough for kids to be happy and healthy does require more money.

    From 2000 to 2004 i went to over 40 countries and lived on a few thousand bucks a year. Now with kids, i spent more on a single flight (4 people remember) than i did on a year traveling as a single family-less person. Overland from Buenos Aires to Mexico City, is a lot less fun if you’re changing diapers. Often you’ll chose to fly the legs, that makes it MUCH more expensive.

    • Good point rabble. We have a few friends who travel like this with children. Check out Christine and Drew’s blog over at almostfearless.com. I travelled around India with Drew and we’ve met them in a couple of cities now with their young son (I think he’s 2 years old). I know others do it too, but I imagine, like you said, it’s a lot more difficult.

    • Rabble-

      I’m taking off with kids in January. A couple things we’re going to do to alleviate the problem are:

      1) Set up a home base to save on rent, have toys & dishes, utilities, etc. Since we’re planning on staying a longer time (6 months to 1 year) we can afford to set down some roots. Rent will actually be significantly less than hotel, and we’ll be able to build our network of friends. It help’s that we already know people in our home base.

      2) My wife is going to be a full time mom. I’m going to work but we hope to include lots of travel time as well. But they will be shorter trips and we can come back to our base to recuperate. Local air travel will be less expensive than globetrotting trips, but we can still make trips to Colombia and Peru for around $200/person.

      While we can’t expect to go couchsurfing with kids, we may end up meeting other people who we can visit or exchange places with as well.

  11. Could not agree more Todd! In India, we typically think of travelling as the last place to put our money after education, house, family, saving for later- in that order. Not that these aspects are not important, but then I’d rather travel while I can and enjoy it all while I am able. I’ll probably get in the bigger, longer trips/adventures in now and go to the quieter/leisure holidays later. But travel I must.

  12. Found your site/blog yesterday whilst doing some research for a company I’m working for (http://mud-inc.com/). Just wanted to say you’re super inspirational and your writing is superb! I read a few other posts when I got home and will be coming back regularly – travelling is something I want to do! Have just started my adventure from moving to London to Melbourne. Seeing where life takes me!

  13. Hi Todd,
    I came across your site as I am seriously considering quitting my job of 18 years. I know I can afford to do this and know someone that did years ago and has been happy with the decision ever since. I am single and my biggest concern is doing this alone. I’ve heard “you won’t be for long!” repeatedly. I’m outgoing and have the finances to pull it off, but the fear of loneliness is holding me back. At home, I have groups of friends that keep me busy. I have been waiting to meet the right woman who can share the experience, but the women I’ve met so far can’t or won’t due to kids, careers, etc. What do you think? Thank you.

    • Hey BigKid4Life,

      If you’re outgoing, you really shouldn’t have a problem as long as you’re willing to put in the effort to meetup with people when you get a little lonely. There’s no doubt you’ll have moments where you want to throw in the towel due to loneliness. Heck, we’ve been in that situation as a couple. But I think the answer is to do something positive about rather than getting in a rut and wallowing, which is easy to do.

      As for a list of ways to stay busy with other people while travelling:

      Small-group adventure tours
      Meetup.com, facebook, twitter, etc
      Meetups of interest (e.g. learn a language, cooking schools, book clubs, etc.)
      Group accommodation (i.e. hostels)
      Write a blog
      Stay longer!

      The easiest way to have a blast with other people is to join a small adventure tour group. Check out companies like intrepidtravel.com and have a look at their tours all over the world. Their groups are often about 8-10 people and they mostly visit adventurous areas. That’s the other thing, if you go to typical tourist destinations it can be harder to meet people. But if you do something challenging, the connection with others is so much greater. For example, consider joining a group to climb Mt Kilimanjaro or travel through a challenging country (somewhere in Africa, the Middle East, Asia, etc).

      Of course there are also hostels and guesthouses geared for better interactions. Even if you’re older and don’t feel comfortable staying at a party hostel, check out guesthouses. In most of Asia and South America the accomm is so cheap it doesn’t make sense to share a room. So many of the guesthouses are designed for interactions. Just check out the reviews and get a sense.

      I think the best advice is to stay long enough to make connections. At the moment we stay in places 3 months at a time, but even that seems a little short. If visas allow, we’ll start to aim for 6 months in each place. When you stay longer you get a feel for places and meet other long term travellers. You also get more acquainted with locals, depending on language barriers.

      Lastly, think about writing a blog and keeping in contact with other long term travelers. You manage bumping into people all around the world. We’ve been in berline for about 10 days and have already met 2 fellow bloggers and are meeting another 2 tomorrow.

      Hope that helps. Happy travels. You won’t regret doing it, that’s for sure.

  14. Todd,

    Thanks for super inspirational article! I’ve actually started a travel startup after doing investment banking for a few years because I really wanted to travel… The irony of it all is that now I work more than I used to in banking and still don’t get to travel :) So your article got me thinking…. Could we connect via email/skype? I’d love to get your advice on how to run a business on the road…

    BigKid4Live, check out http://www.triptrotting.com. We created this specifically to help people like you! You can meet like-minded locals around the world when you are traveling! We match people based on interests and personalities, so that you actually have something in common with the person you are meeting!

    THANK YOU!

  15. Hey Aika

    That is a very interesting site that you have there, looks like you spent a lot of time thinking through the idea, hope that it is successful for you. Be sure to drop us a line with developments.

  16. It is in reality a great and helpful piece of info. I?m satisfied that you simply shared this helpful information with us. Please keep us informed like this. Thank you for sharing.

Leave a Reply

Your email address will not be published. Required fields are marked *

*

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

 Subscribe to Globetrooper