I appreciate your concerns; defending our decision forces me to look at aspects of this that I may not have considered.
Is it the life we want; in a word: YES!!! We have a bit of it here at the cottage, but we want more. We find here that there are too many people on the lake, too many neighbors, too many annoyances. We'd buy a 1000 acres if we could.
Friends? Does it sound weird to say we don't really have any friends? We have some acquaintances and we have people we work with, but no friends. We don't go out Friday night to the bars with a bunch of people. We drive to our little cottage (where I am at now) and spend the weekend hiding from the world. I had some friends in University, but slowly everyone moved away or lost touch. The one person I considered my best friend basically stopped talking to me when I started making twice what he made.
With regards to our investments, they will continue to grow since we are not actually selling anything. The income being generated is purely from dividends and distributions. I may occasionally sell something to solidify some gains, but that gets reinvested in other dividend paying shares.
With regards to my business, its already long distance. Half of our clients are in California and we've never met them face to face. Everything is done by phone, email and ftp. Because of the nature of our business, the end product is nothing more than electronic files that get sent to the machine shop/sheetmetal shop, or to that injection moulding company on mainland China.
The only real reason we have an office is so our employees have a computer to sit at, a Pro-E license, e-mail and a phone. The model of working remotely has already been well proven; we have a California "office" which is one guy in California who goes around and finds work down there. When he gets a project, he's the prime and everything goes through him. He works directly with our employees here in Ottawa, reviews their work, etc, all over the web. With VPN access its as if he's right on the network; he can grab a Pro-E license, run email, etc.
My business partner will be keeping the office running in return for a 57.5% / 42.5% split, whch will cost me $10,000 - $20,000/year. It seems like a bargain to me given that I no longer have to commute and get to work from home.
We've been doing alot of investigation about the job situation by talking to people on the ground there. It looks like my wife can easily get substitute teacher work and make $15,000 - $20,000/year. At face value, that seems to be a large drop in income. However, consider the expenses we will be eliminating.
Mortgage: $20,000/year
2nd car: $6500/year
Gas for my commute: $2400
Insurance on car: $1200/year
Commute to cottage: $2400/year
Property tax, cottage: $1200/year
Total: $33,700/year
After taxes and various deductions (dental, union dues, drug plan), my wife now nets just over $40,000/year. Its practically a wash. If anything, we may actually be able to save at a faster rate than we are now. Based on my calculations, even if my income drops to the low $100K's, we still have enough to live, max out our RRSPs, and put aside about $60K in company investments. If I make roughly what I am making now, its just extra and will go into savings.
Yes, the housing price is not likely to increase, but the house is free and clear. Selling it for what we paid will net us $140,000 cash, in our pocket, along with the $30,000 reserve fund. That's a hell of a lot of start-up money to go start life somewhere else. Not to mention my wife has a guaranteed job waiting for her if we come back. The only risk is if my company goes belly up, but I see that as being largely out of my control (aside from doing the best job I can do). If the economy tanks, it tanks, regardless of where I am.
SLC Tortfeasor said:
On the one hand, I'm thinking you're too young to move out to the middle of nowhere. You will undoubtedly be pretty isolated in the new place, given how rural it sounds, and how far away it will be from your friends and loved ones. Is that really the life you want for yourself?
Or can you? You're going to be moving out to a place where property probably will not appreciate very fast. You're going to be living partly off your investments, thereby preventing them from growing very big. And your wife will be struggling to find a job, and you'll be trying to keep your business alive long-distance, for probably less money than you're making now.
Basically, you'll be seriously stunting the growth of your net worth.
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