12 Financial Habits for an Early Retirement in Paris
When I was 7-years-old, my wise grandmother gave me some advice. "Mary," she said, "If you buy property when you are young, you can have anything you want when you are old." At that age, all I could think about was an unlimited amount of ice cream and beautiful illustrated books.
As I grew older, went to college, got married and started my career as a college professor at San Diego State University, I never forgot Grandma Hackett's advice. Throughout my life I've combined her wisdom with other financial guidelines.
I learned that paying rent is flushing money down a toilet. You receive no tax credits. You build no equity. Your first purchase won't be your dream home but it can be a first step towards it. Even in today's economy, I believe buying is preferable to renting.
My former husband and I lived on one salary and invested the other in small mountain cottages in Idyllwild, California. When we parted amicably 10 years later, we divided four pieces of property. I parlayed mine into more property.
Balancing instant gratification with deferred gratification
Grandma was a practical woman who was generous but never wasted money. Even though she was raised before we had credit cards, she would not buy anything on credit unless it gained in value (property), added to her ability to earn a living or could be paid in thirty days.
That is hard to do when you need a new car for work. But do you need a new BMW when a smaller less expensive car will do? Is that new dress or suit really necessary? Perhaps a scarf or tie will give you a new look.
Before I pay for something on a monthly basis such as cable TV, I multiply that by 12 months. How much is it costing for the year? Do you really want to pay $200 a month or $2,400 a year to watch television? Over five years that's $12,000. In 10 years, you get the picture. That money is a significant step towards financing a life in Paris. One thousand dollars will purchase a ticket to France.
Grandma Hackett, who was widowed with four young children, also said that if you are going to have children, you should be able to financially care for them. Divorce, death, unemployment, a financial crisis can place the responsibility on you.
The home you buy today may help finance your life in Paris. I rent my home in California and it pays for my living expenses. This is called a "twofer." Another "twofer" is asking how you can help your career and facilitate your dream. Will learning French enhance your job opportunities? That's a "twofer?
Avoid energy leaks
Do not blab to all of your friends that someday you are going to live in Paris. You may change your mind. Be a person of action not words. Don't be in a position of explaining to your friends why you changed your mind. It's self-defeating. Only tell people who will be supportive of you living in Paris.
Learn from the masters
Even though Grandma Hackett didn't have any advice about Paris, other people did. What advice do they have for you? Ask them to introduce you to their friends in Paris. Even their elderly aunt can aid your transition to the City of Light. A friend gave me a letter of introduction to the late George Whitman, the owner of Shakespeare and Company Bookstore. Twenty years later I am still meeting new people and attending their literary events.
Learn the difference between happiness and pleasure
Relationships are more important than material things. Clothes, jewelry and bling bring you pleasure. Pleasure is temporary. Friends, education and time spent in Paris are more permanent and contribute to your overall happiness. Invest in your happiness.
Short range and long range planning
Set a timeline for when you want to live in Paris. "Someday" never happens. It took me 20 years to move to Paris. Your time frame should be measurable such as by your fiftieth birthday. Develop a way to measure your progress.
Do not rely on your parent's money or an inheritance unless it is already legally yours
Wills and some trusts can be changed. When a parent dies, the surviving parent often remarries. The new spouse may be entitled to the property and money. Your parents may need it for their retirement and unexpected health care costs. Or your parents may move to Paris and spend it before you arrive.
Do something today. Go into action
Subscribe to a blog such as I Prefer Paris. Listen to a French language course on your computer. Going into action puts your body in sync with your mind. When they are working together, it is a powerful combination. Each week you should do or learn something that is related to living in Paris.
Research your family tree
Was your grandmother born in Italy, Germany, England, Ireland or any of the EEU countries? If so, you may be entitled to dual citizenship. This can enhance your opportunities to live, work and travel in France or Europe.
The people we love and respect can be a major deterrent to fulfilling our dreams. Mom doesn't want you moving so far away. Dad hates to travel. Your partner mopes every time you mention it. Love them but be careful they don't derail your dreams.
If you have debts, other than real estate, pay them off as quickly as possible.
Have an alternative plan
People fall in love, change jobs, even move to other countries. As we mature our interests change. Be flexible. I lived in Moscow before I moved to Paris.
Pay attention to your retirement plans
Learn about money. How to earn it, invest it and spend it. Be careful of middlemen who make a living off of your money. BEWARE before you give anyone power of attorney over your money or property. I have seen adult children lose all of their parent's money on bad investments, drugs or worse.
Only invest where there is rule of law. Only invest what you can afford to lose
I lost a small beach house in Baja, California due to corruption. Thankfully, it wasn't my primary home. Personally, I don't like the stock market. The news since 2008 explains why.
I didn't inherit any property from my grandmother but I did follow her road map to financial success. Look around for people who are financially successful and happy. Perhaps it's your parents. Perhaps it's a neighbor or your grandparents. Ask for their guidance. Follow their advice. Let them help you retire early and move to Paris.