Early retirement costs, targets & campervans - June 2021
This month, there's really just one question...am I sufficiently brave to say how much our campervan cost? I try to be transparent about how much we spend in early retirement, but the camper cost might be something I'd rather keep a secret. I'll keep typing, and let my fingers decide if I should tell.
Early retirement costs
As well as the campervan, I splurged on some new running shoes. That makes five pairs bought this year...do I have a problem? Sally also bought a pair, although her last pair were at least two years old.
It could have been worse, I actually ordered three pairs, but the Nike's got returned. They're meant to be super-fast, but they also felt super-weird, plus, outside of my dreams, I'm not fast enough to justify them. It's probably just as well given the Nike's cost £234 / €264 / $318. For that much, they darn well ought to be fast, but I guess I'll never know!
The middle set of shoes, Saucony Endorphin Pro 2 for the running geeks, are a race day marathon shoe that are also supposed to help us run fast. My plan is to use them as a carrot, figuratively not literally, bought to motivate me to train for and enter a marathon. It makes sense, at least in my head🤔
What else on money? As usual, we spent more at the grocery store than most people seem to spend, we went out for a few meals and to coffee shops now we're fully vaccinated, took the cats for their rabies shots so they can also feel part of the vaccinated club, and spent a bunch on fuel, road tolls and insurance for the car and camper. I'm, writing this from the UK, but when we get back to France, we need to sell the car so we're not paying duplicate insurance.
It's nice to see some spending on travel again. Our current trip to the UK is to catch up with family, but also a chance for a couple of campervan trips. The camper plans include a long weekend in Norfolk followed by a week visiting friends who are building a house on the Isle of Coll, a small island off the West coast of mainland Scotland.
The campervan cost😯
Here goes, I'm taking a deep breath and ripping the band aid off quickly...the campervan cost €78,594 which is equivalent to £67,972 or US$92,441. Wowsers, that's a lot of money - some of our rental properties cost less! So what did we get for our money and how does it compare to my original idea?
First, my original idea was to buy a used cargo van (high top Ford Transit, Fiat Ducati, Ram Promaster or similar), four or five years old with perhaps 80,000-100,000km (50,000-62,000 miles) on the clock and to self-convert it into a camper. I had a price in my mind of £25,000 / €29,000 / US$34,000 for the van and the conversion combined, but probably adding another 20% to make it £30,000 / €35,000 / US$41,000 was more realistic.
Instead, we spent more than double that, so what changed?
The first thing is we got a smaller van, which you'd think should make it cheaper. The catch, we got a a Volkswagen. These simply aren't cheap, but they are the iconic brand and, I have to admit, I kind of like that.
A used campervan would obviously have been cheaper, but maybe not by as much as you might imagine. The demand is crazy at the moment and used campervans are selling for big money, even those with a lot of kms/miles on the clock.
While I liked the idea of going old school with one of the older classic VW campervans, this is going to double as our daily driver so a safe, comfortable and reliable vehicle was a must. The old VW's look cool, but they aren't known for their reliability, and what we expect from our vehicles today in terms of safety and comfort is light years from what those old vans deliver.
To explain a bit more about the money, just the new van cost €44,065 plus €502 for registration. It's a mid range spec, but we did go for an automatic gearbox and four wheel drive, two expensive options.
By deduction, that means we paid €34,027 for the conversion, which includes both the parts and the labour. It's difficult to break this down because we bought a standard conversion package (cupboards, rock and roll bed, electrics etc) and then added some upgrades such as the pop-up roof, real wood finish, better battery, solar, ungraded fridge etc.
Also worth remembering is that the price we paid includes VAT/Sales Tax of €13,099, so the French government should be pleased they gave us our Carte de Sejour residency card - I think we just paid for it!
When we were looking for a campervan, we saw other similar sized new ones ranging from €50,000's up to €65,000, so quite a bit less than we paid. We looked at Ford, Fiat, Renaut and other VW's, but none had four wheel drive and only one had the auto transmission that we wanted. Plus the spec was lower and the finish didn't pull at our heart strings. Ironically, we also found that bigger vans were often no more expensive, and sometimes a fair bit cheaper. For a moment I was tempted to go for one of these bigger vans, but we have nowhere to park it and it would have been nerve wracking to drive something bigger on alpine roads. The smaller version was the right choice.
On reflection, there's no doubt we bought an expensive van, but I think we got a premium product and we're happy with what we bought. It will depreciate, but the VW's do hold value better than most, and our plan is to keep it for a long time. Is it good value? Provided we use it, the answer will be yes, we have a daily driver and our own personal hotel room all in one. Plus, we can afford it, so why not do what makes us happy - we just have to remember that maybe we can't always splash out to this degree.
Oh, and in case you are wondering what this campervan that I'm talking about looks like, here's the link to my we got our CAMPERVAN post.
Can we really afford it?
I say that we can afford the pricey camper, but can we really? I'm sure my gut feel answer of yes is correct, but do the actual numbers tell the same story?
Since I started my full time early retirement on1 January 2017, we've had income from our rental property portfolio, Sally's work (she worked full time until June 2018 and also part time since May 2020), and even I contributed three days of consultancy work at one point!
We've paid our taxes, sold two cars when we left Dubai, bought a car when we arrived in France, and now the campervan. Next up is to sell the car, but this isn't yet done so the money isn't in the bank.
And of course we've spent money. On living costs, groceries, utility bills, ski and bike gear, leisure and, before Covid, much more than I expected on travel. There's other stuff too, as the above table of costs shows.
If we combine these things, what does it show? Have the first four and a half years of my early retirement been cash positive or are we spending more than we're getting in?
It's good news, we're cash positive over the four and a half year period. Our income has been more that our costs, even including the amount we've just spent on the campervan. On top of that, 43% of our investment portfolio is in ETF's and a few other smaller investments, and we haven't drawn down any income from these at all. Subconsciously I worked some "one more years" and the pay off is that we have the ability to treat ourselves now. In this case, we paid a bit extra to get the campervan that we wanted, but the numbers, and not just my gut feel, show that we can afford it.
I've not thought about my targets much this month. Our daughter came to visit, we travelled back to the UK and we're currently in the midst of our Covid travel quarantine. These things aren't part of my normal routine and I definitely operate better with a routine.
That said, I still kept up with my running target. I'm taking part in a relay event in Berlin in August and have to be ready to run my 59km leg - our team leader has set a pace goal so I'd better make sure I can achieve it! I took a week off from publishing a blog post when my daughter visited, but posted each week outside of this. Also during my daughter's visit, we visited the town of Évian-les-bains, the place where the famous bottled water comes from.
I'm up to 193 consecutive days of French on Duolingo, the fact that I'm still hopeless is presumably down to me more that Duolingo. On investing, I've decided to put some cash into UK National Savings (Premium Bonds) - I'm not saying it's the best idea, but I still don't feel able to buy ETF's at current prices and the Premium Bonds will at least give a small return, and perhaps we could win one of the big prizes?!
That's it for my June update. 30 June is exactly five years since my last day of full time work, and four and a half years since I started full time early retirement. In hindsight, would I change that decision, not a chance!