Moving back to Europe

[W2R]

So glad that the tax situation seems to be more in your favor now than it was previously, FIREd, even if taxes are still a bit rugged over there. And also I am glad that things are moving forward with HSBC.

You are making great progress!

 

[FIREd]

So glad that the tax situation seems to be more in your favor now than it was previously, FIREd, even if taxes are still a bit rugged over there. And also I am glad that things are moving forward with HSBC.

You are making great progress!

Thanks W2R!

Taxes are definitely high (though I am learning new ways to reduce them everyday it seems) but the rest of my expenses should be pretty low. I have refined my expected ex-tax budget for 2019:

Single guy, paid for 1-bedroom condo in a nice town < 5 miles from downtown Geneva - one of the most expensive cities in the world)

Groceries: €400
HOA Fees: €250 (includes heating, maintenance, etc...)
Property Taxes: €150
Car insurance: €50 (for compact SUV)
Home insurance: €50
Health insurance: €200 (rock bottom deductibles and copays, covers dental and vision too)
Electricity/water: €75
Cell Phone: €30 (unlimited calls and texts, 10GB data)
Home internet/TV/phone: €50 (1GB internet, 160 TV channels, unlimited calls)
Gasoline: €170
Emergency fund: €250 (car maintenance + replacement, misc., etc...)

Total: 1675 euros per month ($1,943)

These estimates are based on real life data or by looking up the price of services online. They are also on the conservative side.

 

[NW-Bound]

Single guy, paid for 1-bedroom condo in a nice town < 5 miles from downtown Geneva - one of the most expensive cities in the world)

Geneva or rather the entire Switzerland is awfully expensive. When looking for Airbnb & hotel rooms, I saw that the prices of everything dropped across the border. On the 2nd trip there recently, I stayed on the French side.

Makes me wonder how the Swiss government keeps Swiss people from going to the French side to shop. There's a custom booth at the highway border crossing, but when I took the back roads, the crossing was seamless and invisible.

PS. I still remember that, at Château de Chillon, a cup of coffee dispensed off a vending machine was 5 or 6 Swiss francs! Good grief.

 

[FIREd]

Geneva or rather the entire Switzerland is awfully expensive. When looking for Airbnb & hotel rooms, I saw that the prices of everything dropped across the border. On the 2nd trip there recently, I stayed on the French side.

Makes me wonder how the Swiss government keeps Swiss people from going to the French side to shop. There's a custom booth at the highway border crossing, but when I took the back roads, the crossing was seamless and invisible.

PS. I still remember that, at Château de Chillon, a cup of coffee dispensed off a vending machine was 5 or 6 Swiss francs! Good grief.

With Switzerland being part of Schengen, the border between France and Switzerland is pretty soft (I can't remember the last time I was controlled going through the border). So there is no stopping Swiss people from crossing the border to shop - next time you go there check out the number of Swiss licence plates on the parking lot of French supermarkets close to the border! And many Swiss people now live on the French side as well (as Geneva proper has become outrageously expensive).

 

[W2R]

FIREd, your budget sounds very affordable, especially considering that it is so close to Geneva. I love the low cost of health insurance! That's simply amazing. I like that it includes a €250 emergency fund. Does that €75 for electricity and water include heat? Well, whether it does or not, it looks like your expenses are low and you will have plenty of "wiggle room" in your budget, in case you need or want a little extra for heat, clothing, entertainment, or anything at all.

It's great to see your plan coming together, step by step.

 

[FIREd]

FIREd, your budget sounds very affordable, especially considering that it is so close to Geneva. I love the low cost of health insurance! That's simply amazing. I like that it includes a €250 emergency fund. Does that €75 for electricity and water include heat? Well, whether it does or not, it looks like your expenses are low and you will have plenty of "wiggle room" in your budget, in case you need or want a little extra for heat, clothing, entertainment, or anything at all.

It's great to see your plan coming together, step by step.

The budget above is valid for older condominiums, which are prevalent in that area. They usually have a centralized furnace which provides heating and hot water to all residents, the cost of which is included in the relatively high HOA fees (€250 per month). Newer condominiums usually let residents pay for their own heating and hot water. For those, HOA fees are usually much lower (€100-150) but the electric (or gas) bill is commensurately higher. Overall, it should not make a big difference on my budget, though individual heating would provide more budgetary flexibility (you get to choose how much heating you need).

 

[Huston55]

Happy that you got some “good” news!

I’m interpreting your budget as mostly “essential expenses” so, hope there’s room for some discretionary things like travel, entertainment, etc.

How does the healthcare work? What’s the monthly payment for; participation, or access to better care/more Drs?

 

[FIREd]

Happy that you got some “good” news!

I’m interpreting your budget as mostly “essential expenses” so, hope there’s room for some discretionary things like travel, entertainment, etc.

How does the healthcare work? What’s the monthly payment for; participation, or access to better care/more Drs?

Yes, those are "essential" expenses. There will be quite a bit left for the fun stuff. My goal however is to keep recurring expenses low. I recently realized how freeing it is to be single with low fixed expenses.

As for healthcare, it works very much like Medicare. I have to pay to get coverage from the national health system (in my case ~€100 a month), but I also need to get a private supplemental insurance (also ~€100 a month for top of the line coverage). The national health system will cover only part of my medical expenses (almost all in case of serious illness or long-term hospitalization), and the supplemental insurance will cover the rest (more or less - the more you pay in premiums, the less out-of-pocket costs you will have generally). Since I am still pretty young, I might go for a cheaper supplemental coverage (~€30 a month), which covers only the big ticket items (like short-term hospitalization), the equivalent of catastrophic coverage in the US.

 

[tulak]

Yes, those are "essential" expenses. There will be quite a bit left for the fun stuff. My goal however is to keep recurring expenses low. I recently realized how freeing it is to be single with low fixed expenses.

I couldn’t agree more. My only difficulty is figuring out how to lower my fixed expenses. But time will solve that problem for me and I can’t wait!

And congrats on the transition so far. It sounds like it is progressing very well. That’s awesome!

 

[FIREd]

Update:

1) closed my small Roth IRA (I had 10% withheld to account for the penalties) and I will have to pay taxes on the gains (the money in the Roth came from IRA conversions that were less than 5 years old and I am younger than 59.5). Ouch.
2) closed a bunch of smaller CDs - I had to pay some small penalties on those. But I still have to close my larger CDs at Penfed and Andrews Federal Credit Union. The terms for early redemption penalties were changed well after I opened those CDs. They were reasonable at the time, but they are ridiculous now (30% of all interests that could have been earned over the life of the CD at Penfed for example. Those were 10-year CDs, so it is like a 3-year penalty!). Double Ouch! I will try to negotiate those penalties down.
3) I am using up the money in my HSA for dental work, new glasses, etc... to reduce the 20% penalty I will have to pay on what's left in it when I close it (hopefully not much).
4) I am getting ready to redeem my I-bonds at Treasury Direct. I also have some paper bonds that I would like to redeem but do banks still do that? Should I convert them to electronic bonds instead?
5) took a trip to DC this weekend to visit the nearest HSBC branch I could find (still a long way from Alabama!) to complete my application for a French checking account. While I was there, I opened a US savings account paying 2% to park my cash during the transition.
6) While I wait for my new French account to open, I have started converting some USD into Euros using Transferwise. So far I have been very pleased with the exchange rate I have received (I am counting on an average rate of $1.20, anything below that is a bonus).
7) I made a revised estimate of my 2018 tax liability (taking into account the divorce and the disposition of my investments) and I will pay my 4th quarterly payment before leaving the country.
8) Oh and the divorce is now final! We ended up divorcing on the cheap (about $1,100 for the mediator and court fees), so I can't complain.

Next week, I will contact movers to get quotes. I have been sorting out my things and selling the excess. I made a few thousand dollars so far - maybe enough to pay for the move. And I got a bit of good news. Thanks to a recent reform, it looks like health insurance in France will cost me about €20 per month instead of €100.

 

[W2R]

[…]8) Oh and the divorce is now final! We ended up divorcing on the cheap (about $1,100 for the mediator and court fees), so I can't complain.

That's terrific! Good deal.

Next week, I will contact movers to get quotes. I have been sorting out my things and selling the excess. I made a few thousand dollars so far - maybe enough to pay for the move.

I hope so. Moving overseas can be insanely expensive IIRC.

And I got a bit of good news. Thanks to a recent reform, it looks like health insurance in France will cost me about €20 per month instead of €100.

WOW!!!! Utterly incredible! I know that you are young, but still, that sounds like such a bargain.

 

[FIREd]

WOW!!!! Utterly incredible! I know that you are young, but still, that sounds like such a bargain.

Actually, until you mentioned it, I had not realized that age was not even a factor in one's premium calculation! It is solely based on taxable income. But age is a factor when contracting a private supplemental insurance policy.

 

[W2R]

Actually, until you mentioned it, I had not realized that age was not even a factor in one's premium calculation! It is solely based on taxable income. But age is a factor when contracting a private supplemental insurance policy.

Simply amazing. Great, affordable health care will be a big help in retirement.

 

[Huston55]

Update:
Next week, I will contact movers to get quotes. I have been sorting out my things and selling the excess. I made a few thousand dollars so far - maybe enough to pay for the move. And I got a bit of good news. Thanks to a recent reform, it looks like health insurance in France will cost me about €20 per month instead of €100.

Having moved many times, including significant downsizing upon RE, my advice would be to be brutal when purging. It seems one always keeps more than needed, or even wanted after a short bit of time in the new place. Plus, you’ll have paid to ship it internationally. Some purging rules would be:

1. Haven’t worn or used it in a year? Purge
2. For personal items/memorabilia, if it doesn’t bring you tears or overwhelming sadness to get rid of it? Purge (Note: pictures or digitizing is an option)
3. Old and/or worn out? Purge
4. Won’t fit into your new condo? Purge
5. Costs => to move it than to buy new? Purge (Note: Moving cost is mostly by weight so, you’d be surprised what qualifies for purging-most furniture, appliances, exercise machines, books, etc.)

Plus (and I’m guessing here), my bet is you will derive psychological peace from having “new” stuff around you...in your new place. All the Best!

 

[W2R]

Having moved many times, including significant downsizing upon RE, my advice would be to be brutal when purging. It seems one always keeps more than needed, or even wanted after a short bit of time in the new place. Plus, you’ll have paid to ship it internationally. Some purging rules would be:

[…]

Plus (and I’m guessing here), my bet is you will derive psychological peace from having “new” stuff around you...in your new place. All the Best!

+10000
Huston55, that is so well said, and so true. Every time I have moved overseas, I later wished that I had not brought so much stuff.

In fact, Frank and I decided long ago that in the unlikely event that we should ever decide to move to another state, we will take no more than fits inside our SUV's. While we like our stuff, really it is not worth the expense of moving even across the country, much less overseas.

 

[FIREd]

Having moved many times, including significant downsizing upon RE, my advice would be to be brutal when purging. It seems one always keeps more than needed, or even wanted after a short bit of time in the new place. Plus, you’ll have paid to ship it internationally. Some purging rules would be:

1. Haven’t worn or used it in a year? Purge
2. For personal items/memorabilia, if it doesn’t bring you tears or overwhelming sadness to get rid of it? Purge (Note: pictures or digitizing is an option)
3. Old and/or worn out? Purge
4. Won’t fit into your new condo? Purge
5. Costs => to move it than to buy new? Purge (Note: Moving cost is mostly by weight so, you’d be surprised what qualifies for purging-most furniture, appliances, exercise machines, books, etc.)

Plus (and I’m guessing here), my bet is you will derive psychological peace from having “new” stuff around you...in your new place. All the Best!

Great advice!
I won't be taking much furniture with me (I agreed to let my wife keep almost all of it during the divorce because, as you mentioned, I did not want to hang on to stuff that would constantly remind me of her). Most appliances (except small electronics) won't work in France without a voltage converter, so I am leaving them behind too. I am left with personal items and I have been purging them.

 

[Bestwifeever]

So glad you are able to move on so quickly and start living the rest of your life the way YOU want to. Sounds like the finances are shaking out as well or better than expected, too. We’ll see if a French accent sneaks into your posts now.

 

[Retch The Grate]

glad it sounds like things are working out well.

 

[deserat]

Update:
4) I am getting ready to redeem my I-bonds at Treasury Direct. I also have some paper bonds that I would like to redeem but do banks still do that? Should I convert them to electronic bonds instead?

Yes, banks will redeem the paper bonds, although they want you to be a customer - otherwise you can do this via the Treasury, I think. I redeemed all of my bonds last year at Chase bank....had an account there through my mother.

Otherwise, it looks the transition is going as smoothly as possible. Glad to hear it.

 

[deserat]

Great advice!
I won't be taking much furniture with me (I agreed to let my wife keep almost all of it during the divorce because, as you mentioned, I did not want to hang on to stuff that would constantly remind me of her). Most appliances (except small electronics) won't work in France without a voltage converter, so I am leaving them behind too. I am left with personal items and I have been purging them.

I remember when I 'moved' to Germany and for six months and then Italy ostensibly for six months - I was able to get everything into two large duffel bags plus a backpack. I still had stuff at home, but when I came home I realized that what I had at home was not necessary but nice to have. It can be an interesting discovery....while I like my stuff, there is little that I actually *need.*

 

[FIREd]

Yes, banks will redeem the paper bonds, although they want you to be a customer - otherwise you can do this via the Treasury, I think. I redeemed all of my bonds last year at Chase bank....had an account there through my mother.

Otherwise, it looks the transition is going as smoothly as possible. Glad to hear it.

Oh good! I have an account at Wells Fargo and I will check with them tomorrow to see if they can redeem my paper bonds.

 

[Hermit]

Oh good! I have an account at Wells Fargo and I will check with them tomorrow to see if they can redeem my paper bonds.

I had quite a stack of paper bonds I redeemed at the local Wells Fargo about 5 years ago. I didn't even have an account there.

 

[Alan]

Thanks for the update Mr FIREd

It looks like things are progressing very nicely.

Pleased to hear that Transferwise is working so well for you. I love it and use it regularly to move my US pensions and other monies from the US to the UK. Even though I have UK and US HSBC accounts linked together and can move money in an hour, the Transferwise rates sell beat them handily every time so I’m prepared to wait until next business day to get the money.

 

[FIREd]

I had quite a stack of paper bonds I redeemed at the local Wells Fargo about 5 years ago. I didn't even have an account there.

Thanks! I went to Wells this morning and the teller was able to redeem my paper bonds in no time.

 

[FIREd]

Update:

Got the first estimate for my move to France: about $3.5 per pound! Time to downsize some more...