BiggerPockets Money Podcast - Making Six Figures While Living Abroad (NO W2!) to FI Even Faster

Episode Date: November 19, 2024

Would you move abroad to reach FI faster? That wasn’t Brooklin Nash’s original goal when he left the US and began freelancing from afar. But now, years later, he realizes how much of a leg up he has financially by going all-in on “geo arbitrage.” He’s saving a boatload in Guatemala, paying less to live the life he loves, and enjoying a tiny tax bill. Now in his mid-thirties, he’s already Coast FIRE and works when and where he wants. But Brooklin’s money story didn’t start so stable. Being raised in a home with “risky” finances, to say the least (pyramid schemes, gambling, etc.), left him scarred and constantly worrying about keeping enough money in the bank. Thankfully, he changed his ways and realized that making money, rather than just saving every cent, was crucial to becoming financially free. He’s paid off a significant sum in student loans and did it all while making a very meager income. Then, he scaled from freelancing abroad to building an entire business, making a phenomenal income while living in a low-cost-of-living area. He’s living his dream life outside the US, making more money than Americans at home. Imagine what THAT can do for your FIRE number!  In This Episode We Cover Using “geo arbitrage” to save more, invest more, and lower your cost of living  An almost unbelievable income tax exclusion Americans abroad can access  How Brooklin paid off $80,000 in student debt (even on a lower income) Turning your freelancing work into a full-blown (and VERY high-paying) business  Why the optimal FIRE lifestyle may actually include working a few hours a day  And So Much More! Links from the Show Mindy on BiggerPockets Scott on BiggerPockets Listen to All Your Favorite BiggerPockets Podcasts in One Place Join BiggerPockets for FREE Email Mindy: [e-mail] Email Scott: [e-mail] BiggerPockets Money Facebook Group Beam Content Try Baselane, the One Platform for All Your Property Banking & Finances Reach FI Faster with “Set for Life” Find an Investor-Friendly Agent in Your Area The Best (and Worst) States in the US to Retire in 2024 (FIRE Faster?) Connect with Brooklin (00:00) Intro (01:00) Pyramid Schemes, MLMs, and Risky Bets (04:35) Paying Off $80K Debt (10:30) Finding FIRE and First $100K (14:19) Freelancing to Boost Income (16:40) Building His Business (20:11) FIRE Progress (26:40) Why Live in Guatemala? (30:54) Investing from Abroad (32:43) Geographic Arbitrage 101 (38:19) Connect with Brooklin! Check out more resources from this show on BiggerPockets.com and https://www.biggerpockets.com/blog/money-582 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email [e-mail] Learn more about your ad choices. Visit megaphone.fm/adchoices

We are very excited to have Brooklyn Nash on the show with us today. Brooklyn grew up in a household with unstable finances, but he was able to break the generational cycle with a few creative moves, namely geo-arbitrage and starting a small but very profitable writing business. These are going to set him and his kids up for a very different financial future. With your current circumstances, you may be a long way from fire, but what if relocating was the only thing that it took for? for you to reach your financial independence number?

And should you do it? Hello, hello, hello, and welcome to the Bigger Pockets Money podcast. My name is Mindy Jensen. And with me, as always, is my not arbitraging his geolocation quite yet. Co-hosts Scott Trench. Thanks, Mindy. Good to see. You never get tired of trading out new introductions for me.

All right, Bigger Pockets has a goal of creating one million millionaires. You're in the right place if you want to get your financial house in order because we truly believe financial freedom is attainable for everyone. No matter when or where you're. You're starting. Brooklyn Nash, welcome to the Bigger Pockets Money podcast. I am so excited to talk to you today. Me too. Thanks, Mindy. So Brooklyn, let's jump right into it. We understand that your family had a sort of unstable or risky relationship with money growing up. Can you share a little bit about what that looked like? It was, risky is the word. All the financial advice that has become so prevalent over the last decade with Ramit Sethi and even, I don't know, all the fun. fundamentals weren't there necessarily, so I do give them a little bit benefit of the doubt.

But there were a lot of pyramid schemes. There were a lot of get-rich-quick schemes. They were Y2K preppers. We had pampered chef in the house, like those shows, Excel phone lines. They did the essential oil thing, the pyramid scheme, like anything to make a buck. And then on the flip side, they're also very, very frugal. So they were good at being frugal with their money, but then on the bigger investments, on the flip side of that equation, they didn't like stay the program. So it just turned into 20 years of financial upheaval every few years.

So can you give us a couple of examples? Like are you saying basically that your parents would accumulate, they would try these get rich quick screams. They would blow up in their face. And despite their frugality, they would lose everything or there would be a bankruptcy or there would be a forced lifestyle reduction. Is that how I understand that? Yeah, there are the big ones and the small ones. Pyramid schemes, I don't think, ever took a huge toll, but my dad would do the risky betting on Wall Street,

like Wall Street bet type stuff, penny stocks when I don't pretend to understand that. I just stick it in an index fund. So there's a lot of cycles of losing money that way. And then similarly for housing decisions and just kind of buying more than we could afford. And those were the bigger impact stuff. So what lessons did you learn from watching your parents go through this? Because I, after, you know, 500 plus episodes of this show, I find that people either are exactly like their parents or the polar opposite of their parents based on what their parents were doing, either right or wrong. I think the biggest thing that I had to untangle was these two parts of the equation where you can, it's to reach financial independence, you can focus on earning more or saving more with what you're. earning and my parents really over-emphasized that second part and under-emphasized the first part.

It took a while for me to untangle that. The first fight that my wife and I both remember was over this. We were out, needed to get clothes at a mall, and we were coming back. She was hungry, wanted food at the food court. I grew up really frugal. Going out wasn't a thing. I'm like, well, can we go home or half an hour from home and make lunch? And it turned into a big fight because we had.

very different upbringings and expectations. And I'm not, it wasn't the next day. It was probably over a year or two, slowly realizing that frugality can only take you so far. And there's a lot you can do, especially now, to increase your income. So we started focusing after our first and second year of marriage away from, let's spend as little as possible and deny ourselves all these things and instead let's turn our attention towards an abundance mindset and seeing what we can do income-wise and what that can mean for our family and forgiving and for everything we wanted to do together. Could you maybe give us a little bit of the synopsis of the story here? You know, how did your money journey go? I think we know that you met your wife in college. Can you give us

how your personal financial story went in college, following college and in the last couple of years? My wife and I both went to a private university in Southern California, probably not a great start financial-wise. But thankfully, we both got really solid financial aid for the four years. The debt that we did accumulate was more, it was housing and all these other factors, which add up when you don't have parents that can help out with college. We're very grateful for the financial aid, but graduated between the both of us with 80,000 in student debt. So our first year of marriage was, okay, this is debt as an emergency. Let's treat this as an emergency. Back then it was Dave Ramsey stuff because we were at that level.

So we just focused on paying off the student debt first. We did very little investing and very little savings for, I think, two years. We had the bare minimum, like, $1,000 emergency fund just because we wanted to throw as much as possible at the student loans. I don't mean to give as advice because we very much over, we're very debt averse. So we very much over-emphasize, let's get this thing paid off as quickly as possible. So we paid it off in about five years. When really looking back, we could have taken a more balanced approach and maybe should have been investing a third of that. And over 10 years, it probably would have served us better.

But it did feel really good about five years in to just have it completely wiped and start with a net worth of zero. And what year was this? Late 2017 or early 2018. Okay. And where were you working? Were you self-employed? or were you working for another company? It was a bit of both.

So we moved right out of college. We moved to Israel for my master's program. And then we moved to Guatemala to work with a nonprofit. Nonprofit didn't pay anything. We were essentially volunteers out of college, you know, bright-eyed and purpose-driven and all of that. And we were freelancing on the side to start paying off the student debt and savings and all of that. So for a while, there was a whole mix of income.

and those first five years was essentially all freelance income. Freelance income and you had a $1,000 safety net? I'm not familiar with the economic conditions in Israel. Is that more of a high cost of living or a low cost of living area? Super high cost of living in Tel Aviv. Super expensive. Yeah, that's what I thought. All freelance income, $1,000 safety net in a high cost of living area.

Don't do that, listener. Well, that was one year out of five. So it bounced out because then we moved to Guatemala, which is super low cost of living, right? So that was where. For a year, you had, that's a lot of risk. Did you feel like it was risky? Or did you feel like, you know what, I'm okay with this because I want to get this debt gone so fast? I don't think it felt risky to us at the time.

Although you're right. Hindsight, same thing. We should have at least saved up a bigger emergency fund with some of what we're using to pay off the loans. But it didn't feel risky at the time. And I know this isn't what this podcast is about, but in general, I don't think freelance income is as risky as most people think it is. If you're a freelancer and you have six clients, what are the chances that in a matter of three months, all six of those clients are going to churn? Compared to, there's a downturn. You have one employer. What are the chances that that that large employer that

has very little runway is not going to go through a layoff and that you won't be impacted by a single event. So it sounded a little bit like I got on my soapbox, but like freelance income has been really great for us in terms of just sure there's a ceiling, but there's a, I think a much higher ceiling. You can use your time and your skills. And as you build up your client base, I think it can be not a riskier option than full-time employment. All right. Now a quick ad break. When we're back, Brooklyn will tell us how he was able to break out of bad financial circumstances and make his own path. Tax season is one of the only times all year when most people actually look at their full financial picture, including income, spending, savings, investments, the whole thing. And if you're like

most folks, it can be a little eye-opening. That's why I like Monarch. It helps you see exactly where your money is going, and more importantly, where your tax refund can make the biggest impact. Because the goal isn't just to look backward, it's to actually make progress. Simplify your finances with Monarch. Monarch is the all-in-one personal finance tool designed to make your life easier. It brings your entire financial life, including budgeting, accounts and investments, net worth, and future planning together in one dashboard on your phone or your laptop. Feel aware and in control of finances this tax season and get 50% off your Monarch subscription with the code Pockets. What I personally like is that Monarch keeps you focused on achieving, not just tracking.

You can see your budgets, debt payoff, savings goals, and net worth all in one place. So every decision actually moves in Edle. Achieve your financial goals for good with Monarch, the all-in-one tool that makes money management simple. Use the code Pockets at Monarch.com for half off your first year. That's 50% off at Monarch.com code Pockets. I love Matt, said no one ever. Nobody starts a business thinking, you know what would make this more fun? Calculating quarterly estimated taxes. But somehow every small business owner ends up doing it. Your dreams of creating,

selling, and growing, get replaced by late nights chasing receipts, juggling invoices, and wondering if that bad sushi lunch with Scott counts as a right-off. Change all that with Found. Found is a business banking platform built to take the pain out of managing money. It automatically tracks expenses, organizes invoices and even preps you for tax season without you doing the heavy lifting. You can set aside money for business goals, control spending with virtual cards, and find tax write-offs you didn't even know existed. It saves time, money, and probably a few years of life expectancy. Found has over 30,000 five-star reviews from owners who say, found makes everything easier, expenses, income, profits, taxes, invoices even. So reclaim your time and your sanity. Open a

found account for free at found.com. That's F-O-U-N-D dot com. Found is a financial technology company, not a bank. Banking services are provided by lead bank member FDIC. Don't put this one off. Join thousands of small business owners who have streamlined their finances with Foun. Audible has been a core part of my routine for more than a decade. I started listening years ago to make better use of drive time and workouts, and it stuck. At this point, I've logged over 229 audiobook completions on Audible alone, and I still regularly re-listen to the highest impact titles. Lately, I've been listening to Bigger Liener Stronger for Fitness, the Anxious Generation for parenting perspective and several Arthur Brooks' audiobooks that have been excellent for mental

well-being. What makes Audible so powerful is its breadth. Beyond audiobooks, you also get Audible Originals, podcasts, and a massive back catalog across business, health, parenting, and more, all accessible in one app. If you're looking to turn everyday moments into real progress, Audible has been indispensable for me over over 10 years. Kickstart your well-being journey with your first audiobook free when you sign up for a free 30-day trial at audible.com slash BP money.

Welcome back to the show. Okay, that's actually really good to know because I don't have freelance experience. So I've just always assumed that it's kind of risky. But that makes a, that's a really good point. Like if you have six sources of income and one goes away, now you have five sources of income. If you have one source of income and one goes away, now you have zero sources of income. So that does make sense.

I like the way that you look at that. Especially if you're already financially minded and you are saving what, 30, 40, 50% of your income, you could lose half your clients and still cover your expenses without touching your emergency fund. Yeah, it's also hard to pick up a second client when you work a full-time job. Probably really shouldn't. And on the freelance side, it's probably not too hard to pick up a seventh or eighth client there to 10 or, you know, 20, 30% increase your income. So I think the freelancing world, I think that's right. I also want to talk about, There's a side tangent, I'll just mention really briefly here, where people talk about unemployment in this country.

Well, something's brewing in this freelance and gig economy because I think there was something, some 40 odd million Americans who participated in the gig economy last year. And that was up like 300% from before the Great Recession, for example. And so what happens when a freelance, like surely a lot of those folks found fewer clients, it's harder to get rides for Uber drivers or whatever in there. That doesn't show up on the official unemployment statistics, right? Because as people don't go on unemployment, they're not losing their job. They're just getting less income. So something's brewing there that I don't think people have good data on.

And I think that that's impacting the economy in ways that are not fully appreciated yet. And we'll shake out over the next couple of years. But just something I have observed and thought about a lot recently. on this. So let's bring it back to your story. However, so we have our freelancing in Israel. We're doing that. We pay off the student loans in five years. When does the journey become less about paying off the student loans and more about financial independence? Pretty early, actually. So even, I think, year two, we discovered financial independence through the subreddit. That was the origination. And then from there, Mr. Money Mustache and Rameit Zati and, and,

bigger pockets and just really dove into everything like 2014, 2015. And paying off student loans was for us that first step. We didn't do the more balanced approach. That is probably a lot smarter and that you all recommend and much smarter people than us recommend. But to us, the debt represented a fresh start. So from year two, paying off that debt became the first goal. And then once we paid it off, then we're like, okay, what is the next goal? That's increase our income to XYZ and hit 100,000 investments. And then we started hard charging towards that. And how long did that take you to get to 100,000 in investments? Within a couple of years, because around that time is about when we stopped working with the nonprofit, started working full

time in marketing and writing work. So we pretty dramatically increased our income around that time. Awesome. So let's walk through that part of the journey. So how long were you in Israel? And when did your situation begin to change? I believe it sneak peek is still international to this day. But can you walk us through the journey and the steps? Yeah. So we were only in Israel for a year for my master's program and then we moved to Guatemala, which that's the biggest context here because this wouldn't literally wouldn't have been possible if we were living in the United States. Because for a few years there, we were able to live off of. 10 to $12,000 a year, which helped us achieve our goals. So the four years, four of the five years were here, Guatemala paying off student debt, working with the nonprofit. And then the last five years have been out of the nonprofit, really focused on what can we do to maximize our income and meet our next goals.

So, and we're still, we're still here in Guatemala. Okay. So you guys are earning, can you, can you give us a little bit, kind of some guidance? on are you able to earn like six-figure salaries doing this from Guatemala? How does this career growth happen from international perspective to provide opportunities that you wouldn't have had access to otherwise? Or how did you get into this and decide to go to Guatemala, stay in Guatemala, and build your career from there?

Yeah, it was a very indirect path. So we came to Guatemala not for any career moves or the money sense. It was just to work with the nonprofit. We both graduated with sociology degrees and international development and social work and really wanted to dive into that world. We kind of discovered financial independence along the way, and it worked out that we were working in the low cost of the limit, and then it was just a matter of putting the puzzle pieces together.

Yeah, I'd love to get the next piece there. Tell us about how their career developed. Like, how did you get a job, you know, in marketing that pays enough to sustain financial independence from Guatemala. Is that like, is this another repeatable path for folks? Like, like,

can you, maybe we'll just like a quick edit. And like, that would be really helpful. Think about this from the perspective of someone listening who's like, hmm, I'm starting my career and, you know,

I'm thinking about doing something similar. What are the takeaways that, um, I can get from Brooklyn and think about as in terms of opportunities for me if I want to live internationally or build a career in another country? So year one, about five years ago of going full-time into freelance writing and marketing, my goal was to make $40,000 in that calendar year. I think that first year we hit like $65,000 and then it grew from there.

So I do think it's repeatable now, A, and B, it was just a matter of discovery. So yeah, getting a full-time job, especially a remote job at that time probably would have been close to impossible. freelance opportunities were abundant. I started on Upwork and then grew out from there once we started building our network and just kind of slowly started realizing which types of work, A, were more interesting and sustainable for us and B, which gigs paid more. So over a couple of years, we homed in on B2B tech as our main client base. So narrowing in on that part of the freelance world really helped increase our income and solidify our network. From there, I also took a full-time job for two years while we maintained our freelance business. This whole time,

it was my wife and I working together on it. Those two years were game-changing in a couple of different ways. Number one, financially, the full-time income and the freelance income really just kind of skyrocketed what we were able to do. I don't recommend it for more than the course of a couple of years, but it was the first two years of COVID. We couldn't do anything anyway. So it was just two years of like 60 to 80 hour weeks to kind of jumpstart what we were trying to do. Then once we, once our freelance income outpaced my full-time income, we decided to jump back out a full-time and go all in on the business. So we around that time turned the freelance business into an agency. So some numbers got we, year one, goal was 40,000. First year we hit more like

65,000. By the time we launched the agency, just the freelance income between my wife and I was around 300,000. Split it right down the middle. It's a solid six figures for each of us. But that was about the limit of what we could do ourselves, which is why we turned to an agency model to keep learning and growing and seeing what we could do. Awesome. So tell us about that. So we turned, you turn, you turned in jobs, money for time, and you just use the word agency. Can you tell us about this? Is this a business that you've now built? And when did that start? And how's that going? So far, so good. We started it, launched it about two and a half years ago. And yeah, it's it kind of flipped the switch. It's less trading our own time for money and more, okay, we've got something unique here that there

is a demand for. How can we build a team around it so that this thing can be a machine of its own? and run without us down the line. That doesn't mean necessarily selling, and it doesn't necessarily mean completely stepping back. But it gives us, we look at it as an asset that we can use how we want. So yeah, the last two and a half years have been about building the business.

We have a full-time team of five and about 20 contractors that we work with around the U.S. Okay, so you are creating jobs, and then you make money off of when they do work. you bill them out at X and you pay them Y. And then the same with the contractors. So you're making money. I'm not phrasing it right, but you are connecting these people who are doing a job with people who need a job.

And that's your agency now. A little bit like that. Yeah. I mean, yeah, you're putting the financial model baldly, but that's essentially it is a type of arbitrage. But it's less of a marketplace or recruitment of just connecting people and more we have our full-time team focused. on strategy for clients. So it's very much long-term partnership. Like some of our clients, we've been working with the whole, even before we launched the agency on a freelance basis, and then they transitioned in with us. So it's this long-term relationship on one side with the

client. And then on the freelancer side, we were both freelancers for almost 10 years, eight years before we launched. So we want to provide a really good experience for freelancers. So yeah, we do, we charge one thing to clients and we're able to pay out to our contractors another. But the idea is that in the middle, we're taking off their plate all the time-sucking stuff, like a client communication and hand-holding, the strategy work, the briefs, and we're just letting our writers be writers and our designers be designers. And you're running this for American clients, but from Guatemala. That's right. Yeah. So all over the U.S. Some in Europe. but yeah, mostly U.S.-based.

So this geographic arbitrage that you have been able to take huge advantage of is the difference between a, you know, 10-plus-year-fi journey and, like, do you consider yourself financially independent right now? No, no, not yet. But it's the difference between, you know, this much longer, because America has a higher cost of living than Guatemala does. I mean, you're living on $10,000 or $12,000 a year in Guatemala. that doesn't really get to a lavish lifestyle in the United States. Yeah, it's been the biggest difference, honestly, the last 10 years. I mean, now that was a few years in a row before kids. We were able to live off of that.

Now we're a lot closer and even a little bit above, I think, average American household income. But we've also been able to increase our income at the same time. And that $60,000 to $80,000 goes a lot further. here than it would in San Diego where we're from. Let's set a couple of facts out here. Where in Guatemala do you live? We are just outside Antigua, Guatemala,

which is just outside the capital city. It's the main expat spot. The first five years, we were way up in a mountain town called Weiwei Tenango, which has a, even within Guatemala, has a much lower cost of living. It's like living in a Kansas city, versus LA. Okay, awesome. And do you plan to live in Guatemala for many more years? Like, is this your home now

for the foreseeable future? It is. Yeah. Both our daughters were born here. We bought a house here. So we're here at least the next decade as they move through high school and into what comes next for them. And then, you know, could you give us an idea of how close you are to financial independence and what that target looks like for you? Our goal is definitely shifted. Like I said, when we started, the yearly income was 40,000. Our phi goal was, I think, 800,000, something like very much the lean phi side of things. And then as we, you know, grew up and realized things and had kids and we're like, oh, okay, that's not realistic. Let's go back to the drawing board. So we don't actually have a hard phi number, to be honest. We've kind of shifted our thinking. So I'm saying we,

but that's just because my wife and I talk about this a lot. So I feel grateful that we're very much on the same page. But now for us, it's much less about, okay, we're going to hit $1.8 million by 36 so that we can never work again. And it's much more about, okay, we like work. We like this creative stuff. We like working with people. We don't want to do it for 40 or 50 hours a week.

And we don't want to do it for 30 or 40 years, but we like it. So what can we do now to reduce the time that we're spending working, but not eliminate it altogether? So right now is more about adjusting our schedules, adjusting the level of involvement in the business so that we can be not five and not retired early, but be able to work 20 or 30 hours a week and be able to do school activities. So right now it's much more about adjusting to what our current goals are rather than our goals for a decade from now. One more quick break, and we'll be right back with Brooklyn Nash. Tax season is one of the only times all year when most people actually look at their full financial picture, including income, spending, savings, investments, the whole thing. And if you're like most folks, it can be a little eye-opening.

That's why I like Monarch. It helps you see exactly where your money is going, and more importantly, where your taxed refund can make the biggest impact. Because the goal isn't just to look backward. it's to actually make progress. Simplify your finances with Monarch. Monarch is the all-in-one personal finance tool designed to make your life easier. It brings your entire financial life, including budgeting, accounts and investments, net worth, and future planning together in one dashboard on your phone or your laptop. Feel aware and in control of your finances this tax season and get 50% off your Monarch subscription with the code pockets. What I personally like is that Monarch keeps you

focused on achieving, not just tracking. You can see your budgets, debt payoff, savings goals, and net worth all in one place. So every decision actually moves the needle. Achieve your financial goals for good with Monarch, the all-in-one tool that makes money management simple. Use the code pockets at Monarch.com for half off your first year. That's 50% off at monarch.com code pockets. You just realized your business needed to hire someone yesterday. How can you find amazing candidates fast? Easy. Just use Indeed.

When it comes to hiring, Indeed is all you need. That means you can stop struggling to get your job notice on other job sites. Indeed's sponsor jobs helps you stand out and hire the right people quickly. Your job post jumps straight to the top of the page where your ideal candidates are looking. And it works. Sponsored jobs on Indeed get 45% more applications than non-sponsored posts. The best part? No monthly subscriptions or long-term contracts.

You only pay for results. And speaking of results, in the minute I've been talking to you, 23 people just got hired through Indeed worldwide. There's no need to wait any longer. Speed up your hiring right now with Indeed. And listeners of this show will get a $75 sponsored job credit to get your jobs more visibility at Indeed, dot com slash bigger pockets. Just go to indeed.com slash bigger pockets right now and support our show

by saying you heard about Indeed on this podcast. Indeed.com slash bigger pockets. Terms and conditions apply. Hiring, Indeed is all you need. When you want more, start your business with Northwest Registered Agent and get access to thousands of free guides, tools, and legal forms to help you launch and protect your business all in one place. Build your complete business identity with Northwest today. Northwest Registered Agent has been helping small business owners and entrepreneurs launch and grow businesses for nearly 30 years. They're the largest registered agent and LLC service in the U.S. with over 1,500 corporate guides who are real people who know your local laws and can help you and your business every step of the way. Northwest makes life easy for business owners. They don't

just help you form your business. They give you the free tools you need after you form it, like operating agreements, meeting minutes, and thousands of how-to guides that explain the complicated ins and outs of running a business. And with Northwest, privacy is automatic. They never sell your data and all services are handled in-house because privacy by default is their pledge to all customers. Visit northwest registered agent.com slash money-free and start building something amazing. Get more with Northwest Registered Agent at Northwest Registeredagent.com slash money-free. Let's jump back in. Okay. So you like what you're doing, but you don't want to do it 40, 50 hours a week for 20 or 30

years. I totally understand that. Have you sat down and made a list of the things that you want to do? Or what's the process for figuring out your balance between how much you want to be working versus how much you want to be making? A lot of conversations and trial and error. I think those two years of working 68, 80 hours really showed me, A, I don't want to do this forever. And B, okay, let's walk this back. And instead of we hit, over those two years, I think that's when we broke 350 or around 400,000. And so we laid that really solid foundation. We're Coast Phi essentially right now rather than Phi, going back to your question, Scott. Like if we were to not put another penny in savings, we would be beyond our fine number in quotes at 55. So we're like, okay, Coast Phi is taken care of. Now what do we want to do? So Mindy, it's more talking through, okay, we have it taken care of. All we have to really worry about.

is our current expenses, which we have covered, and then just keep talking about what the next three to ten years look like. So over the next few years, we both envision ourselves staying involved in the business. We don't want to step back completely. So we're good taking our salary, working in the business 30 to 40 hours a week. And then over the next couple of years, the next goal for both of us is how do we get down from 30 to 40 hours to maybe 20 to 30 hours? And is that your goal 20 to 30 hours a week? Or is that just the current goal? And then you'll step. Because, I mean, I think it's really valid. There's this idea that, you know, oh, I'm going to reach financial independence. I'm going to retire early and I'm never going to do anything again. And I live in Longmont, Colorado. I hear from a lot of people. I have a huge community around me of people who have reached financial independence and they've quit their day job. But they don't stop working. And the reason that they quit their day job is, you know, kind of the reason that they started pursuing financial independence in the first place, they weren't happy there. But it sounds like you are happy where you're at. You've, like,

created this job that you love. So stepping away from it is, I don't want to say silly or foolish, because if you don't want to work anymore, then that's like, that's what you want to do. But, you know, when you've got this, what is that stupid phrase? If you love what you do, you'll never work a day in your life. It's also kind of true, though. It's silly, but it's true. I mean, I'm a real estate agent and I get to talk about money and real estate on a podcast. Why would I not work? Yeah, we feel very lucky in that because we had that realization of, okay, most of the people in these forums and on the subreddit and you have full-time jobs and there's not a lot of flexibility. We were able, because we were self-employed to navigate to something.

that we find interesting and creative and we get to do fresh things with our clients over the last few years. So that's helped a ton. That said, I have higher priorities in my life. I want to go to my daughter's dance recitals. I want to pick them up from school. I want to go camping. I want to take surfing lessons with them. I want to be able to take anytime they're off of school, I want to be off of work. Those are my priorities, even if I find work interesting. So yeah, going back to your question, right now the goal is to reduce to about 20 to 30 hours. By the time we hit in June will be the three-year anniversary of our launch. So that's current goal is very much more time-based than it is income-based.

I love the framing of that goal of any time they're off school, I want to be off work. That's like an awesome in-between state for financial independence and full-time work that I think will resonate with a lot of people. I want to ask a couple of mechanical questions here. that relate to you investing and building wealth and building a business out of the United States. Is there particularly special things about Guatemala that make this easier, attractive? Or was it, do you think that, yeah, I guess that's what I want to parse out here. Can you tell us how easy is it for an expat to start a business in and founded and incorporated in a place like Guatemala? Yeah, I should have Becca in here because she's, my wife, she's our husband.

head of operations and knows the mechanics much better than I do. But in short, Guatemala doesn't have any special advantages financially. What the biggest advantage is, no matter what you do, whether you're full-time or self-employed, is the foreign earned income exclusion. So up to, I forget what it is this year, but it's getting higher and higher every year, just like 401Ks and tax credits. It's in the six figures of income that you earn while physically, out of the United States. I'm not a CPA, so check this and there's exceptions and there's a lot of rules, but is not taxed at the federal level. So beyond just the cost of living savings, we've paid a lot less tax than if we had been living in the United States. The only requirement

there is that you're out of the United States for 330 days out of a 365-day calendar. Do you pay income tax to the U.S. government on any of income? earned in the United States? That's what I mean. The federal earned income exclusion is we don't pay federal tax on up to it when we started. It was like 120 something thousand and it just has gone up from there. Okay, got it. That's for the U.S. government. And then how about for Guatemala? How do the taxes work there? Certain taxes for being residents and owning property, there's some property tax. but there's no, because our income isn't from a Guatemalan company, we don't pay income tax either. So tax burden here has been, I think, a couple grand a year.

Awesome. Okay. And do you have to be a citizen in order to incorporate a business that is headquartered in Guatemala, or how does that work? Getting into the mechanics, we're actually a U.S. business. So we don't have a Guatemalan presence. So even our business is registered in the U.S. We live physically outside of the U.S.

So we're able to, A, attract U.S. clients because we're a U.S. business and paperwork and connecting payments and all that is seamless. But we're also able to claim the foreign earned income exclusion because we're physically out of the U.S. for 11 out of 12 months. This is super fascinating and stuff I don't know anything about. You know, I'd be interested to hear commenters' perspectives on the intricacies of this. And Brooklyn, I suspect that as your business grows, some of these things that you're saying will not actually be able to scale into larger revenue items. Like, for example, California, and can let you get away with that for very long once you get past a couple hundred thousand in revenue from that state. That's the sticking point.

California, we don't at all. We've paid very little in federal tax, and I don't even know how much in California tax the last 10 years, even though we haven't been in California for 10 years. Let's talk about, so you're not a citizen of Guatemala. You're a U.S. citizen living in Guatemala for many years. That's right. We have residency here, which just means we don't have to leave every three months. every 90 days, we can stay put. Both our daughters were born here. But yeah, we're not citizens. We're U.S. citizens.

Daughters are Guatemalan and U.S. citizens, which is a whole other can of worms for down the line. What do you do for benefits and those types of things, health insurance, all those goodies? We have an administrator in the U.S. that provides benefits for our employees. We technically could take advantage of that if we were in the U.S., but because we're not, we just pay out of pocket.

for international global health with Cigna. It's a, what's it called high deductible, there's an acronym for it, but it's a high deductible one. And that's worked well. We just pay out of pocket because the doctors visit and dentists are so low here. It doesn't make sense for us to pay premium when we could just pay out of pocket. How about the mechanics of investing? What do you invest in?

And I've heard that some folks have no issue investing in things like an index fund, a U.S. stock market index fund internationally. And some folks have to go to great lengths to get creative to try to replicate that because it's not offered to their countries. Can you tell us about your experience with that? Yeah, because we're from the U.S. we're able to participate in the stock market. So we have, but we'll be happy. Like we have a Vanguard account. We're in VT Sachs and Bond, whatever, B, BLTX. And that's about it. So yeah, across our 401K and our brokerage, it's pretty much just index funds with the 90-10 split. Very boring. Now you go put up a whole other can of worms here. If you don't pay any federal income tax and

you don't pay any tax in Guatemala, what is the advantage of contributing to a 401K? It's only up to a certain amount. So we're earning the four for married filed jointly, we're earning well above what the limit is. So contributing to a 401k reduces reduces what we're paying off on top of the exclusion. Okay, so you do contribute to U.S. national debt reduction on an ongoing basis. Yeah, we're not, I sound like such a jerk over here. Yeah, I haven't paid taxes. Well, you live internationally and you don't partake from the system and you contribute in partake. Thank you. Yeah, that's what's wonderful of you. Yeah, we think it was fair because we don't live there. So we pay whatever's above, but 11 and a half months out of the year, we're not there. So

that's where we're at. But yeah, we do pay into federal taxes. And FICA is still a thing, especially as a business. But yeah, federal income, the exclusion has been a big chunk because that's more than half of what our current W-2 salary is. Okay, so Brooklyn, this geographic arbitrage angle that you have invented, ha-ha, sounds like a really amazing way to game this system. So you're making high income. You're living in a low cost of living area and you still have citizenship in America. So should something happen in whatever country you're living in and you could move back? How did you decide to take this jump? Like was it was it hard to say goodbye to your family and like leave all your friends? You can with the internet, you can talk to anybody and you can

send gifts with FedEx and it gets there in like a day and a half. But Is it hard to walk away? It wasn't 11 years ago, but so this is probably a moot point. But at 21, we're like, yeah, worlds are oyster. Let's get out there. And sure, our parents are like, what are you doing? We're like, yeah, we're doing it. So the same reason we just went whole hog on paying off student debt.

We just didn't know what we were doing. We were just jumping into things. So it was hard the first few years. But then once we realized, like, we started, Guatemala started to grow on us. And we realized the financial impact. And we started growing these financial. goals, you know, we stay put. And then the middle part was a little hard. And then now the last few years with our girls growing up in a solid school and a community here, this is just home.

Like, we can't imagine leaving it now. Yeah. So I don't know how relevant that is for, you know, a 36-year-old who's looking at making it change. But I will say I spent a lot of time talking to folks in the space, LinkedIn and Twitter, I won't call it. The other thing. And a lot more people are starting to do this, even as an experiment. So there's people who will go, let's go here for three months and let's see how it feels and then they'll come back and then they'll reassess what their relationship to money is and their house and work and the balance with their kids. And a lot more people are just starting to talk about and think about this, which has been really fun the last couple of years. So it's not like you have to jump in and be like,

I'm going to Guatemala for 10 years. We came here and we were going to stay for one year. here we are 11 years later and we're still 10 years later and we're still here. So just, I think you can take it in chunks and go for a few months and see if you like it and then try a year and see what impact it makes. I, you know, I'm obviously very happy with my job and not looking around on these things. But I know like, oh, I would like, hey, if I wanted to work remotely at DigitalMilmat, I would want to go to New Zealand. Like that's a country that's been in my mind for a lifetime.

And one of these years, I'll spend a year in New Zealand, maybe five, 10 years from now. And that is a place where you cannot work. Like, it's very clear. You're not allowed to work a job, even remotely, from New Zealand with a visitor without a, like a visa from their immigration center. So that's where I was kind of going with that question. It sounds like that issue just does not exist for you in Guatemala. And in some countries, it's easier than in others.

But do you have any commentary or thoughts on that for folks looking at geo-arbitrides, right? Like, there's two extremes. Guatemala sounds really easy. New Zealand, don't go, don't move to New Zealand. and then figure out where work situation later because you're not going to be allowed to do it. They're not going to let you do it. Yeah, I totally botched it on that, Scott, because I was thinking about the disadvantages of Guatemala, or sorry, the advantages of Guatemala rather than disadvantages elsewhere.

But you're totally right. Do your research ahead of like what is required. Guatemala, if you're not a resident, you have to leave every 90 days. So you've got a plan for that. And that's an additional expense. And a lot of countries like New Zealand, Israel, our first year, you can't technically earn an income there. You got to work around things, right? So I was like working at the student writing center at the university and that was like one way around. And then I was like, that's why we started

on freelance income because I'm like, the only way we're going to make money is by going back to US companies or clients and seeing if we can make money there because we can't earn money in Israel. So it really depends on the country. You're right, Scott. I think that just went right over my head the first time around. I was impressed with what seems to be a very favorable environment for you guys in Guatemala that encourages or allows this. And that makes that makes sense, right? You know, Guatemala is not, it is, is, it is, is a different view on immigration than New Zealand does, right? For various reasons. And I think that that's just something to take into account if you're looking to, you know, take the lessons learned from Brooklyn story and apply them in your own

life if you're listening to this. I will say this is very in the weeds of the mechanics. that you're asking about, but the time zone makes a big difference. Guatemala is central time and mountain time. We were in Spain and Portugal last summer and the seven-hour time difference. I was like, we were there three months. I'm like, this is not going to be sustainable. So we were exploring like, what would it look to move to Portugal? Like, nope, Guatemala is home.

This makes it easy. We get to work with U.S. companies and work a normal nine to five. Yeah, I think that's a big deal, right? And that was also probably a big day for my New Zealand dream there because that's a, that's a wild different time zone. But yeah. I don't even know what time is over there. I mean, it's like if you have a client, right?

Like, and they're in mountain time, like, you need to be available during mountain time. I assume, I assume these folks are entrusting you with big parts of the strategy around that. And you got to be available for those types of things. And like your employer, if you're working remote, it's probably going to make you work on their time zone. Redo at bigger pockets. So that's going to be, you know, that's something to consider as you. As you think about this geo-arbitrage component.

Yeah. Well, Brooklyn, where can people find out more about you? On LinkedIn, Brooklyn with an I instead of Y, Nash, and our company's Beamcontent. It's beamcontent.com. If you want to find out more about the team and what we do. But yeah, I always love talking about this stuff. So if you're thinking about the geo-arbitage stuff or digital nomad or moving with your family, I've gotten on a few calls this is the last six.

months with folks. And it's always fun to chat through. So feel free to reach out. Awesome. Brooklyn, thank you so much for your time today. This was a lot of fun. I enjoyed meeting you in real life. We have been online friends for a long time. So thank you so much for your time today. Thanks, Wendy. Thanks, Scott. All right. Thank you for listening. That wraps up this episode of the Bigger Pockets Money podcast. He is Scott Trench and I am Mindy Jensen saying until next time, Key lime.