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Family Gap Year Budget Update – 2 Months

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Our family of four is now two months into our “family gap year” in South America.  We quit our jobs, pulled the kids out of schools, rented out our house, and headed south in June.  We are living in a small village in the Southern Bolivian Andes called “Villa Abecia”, and from here we explore Bolivia and neighboring countries.  We initially planned a $40,000 all-in gap year budget, which includes living in our village for 12 months, moving, travel, plus our long-term storage expenses back in California.  Here’s our first budget update, two months into our adventure.

 

Family Gap Year Budget Update – 2 Months

ExpenseTotal Annual BudgetBudget for 2 MonthsActual Expenses for 2 MonthsVariance Under / (Over) Budget
Total$40,000$11,667$7,796$3,871
Travel To/From Bolivia and U.S.$10,000$5,000$528$4,472
Move-In Expenses$2,000$2,000$1,071$929
Travels Around Bolivia and South America$15,000$2,500$2,432$68
Living In Our Pueblo$10,000$1,667$1,402$265
Long Term Storage in California$3,000$500$397$103
Medical Expenses$0$0$1,035($1,035)
Visa & Other Paperwork$0$0$931($931)

Of our total $40,000 budget for the year, I had expected to spend $11,667 after two months.  There are some considerable upfront costs, such as move-in expenses, and the initial travel from California to Bolivia.   Towards the end of the year, our expenses will probably be lower.  But so far, our actual expenses have only been $7,796, which means we are nearly $4k under budget at this point. (Woo Hoo!)

 

Here’s a breakdown of the various budget categories, and how we’ve spent our money:

 

Flights To/From Bolivia

We initially budgeted $10,000 for travel to and from Bolivia.  That’s $5k each way, or ($1,250 per person).  We took five flights to get down here: San Diego to Dallas, Dallas to Miami, Miami to La Paz, Bolivia,  La Paz to Santa Cruz, Bolivia, and Santa Cruz to Tarija, Bolivia.

 

Thanks to our credit card churning, we got our flights for free all the way to Santa Cruz, Bolivia.  But, we had to stay in a hotel in Santa Cruz ($100), and then we had flights on a local Bolivian airlines to our final destination, Tarija, which cost $300 (for 4 tickets).  Plus, we spent some money in the various airports along the way, and we went to the Book Depository Museum in Dallas on a long layover.  In total we spent $528 to get all four of us from San Diego to Tarija.

 

We saved over $4,000 on our initial travel to Bolivia.  That’s a huge head start on our gap year budget!

 

Move-In Expenses

Our move-in expenses also have come in light so far.  We couldn’t take everything that we need for a whole year of living with us on the plane, so we had to buy stuff when we arrived.  Things like towels, pots and pans, some furniture, and more clothes.

 

We already have a house in our village.  We bought a farm here in 2012, and had the house built over the next few years.  But, the house was largely empty when we arrived this year.  We had to buy beds and mattresses for the kids, dressers for clothes, and a bunch of kitchen utensils.  We also bought more clothes for everyone.

 

We budgeted $2,000 for these one-time move-in expenses.  So far, we’ve only spent about half of that – $1,071.  That means we are $929 under budget here too.

 

Our Travels

The single largest budget item is $15,000 for travels we have planned around Bolivia and neighboring countries.  We want to go to Peru, Argentina, and a bunch of places around Bolivia.  It sounds like a lot of money for trips, but there’s a lot to see down here, and we want to take full advantage of our year off.

 

We’ve already spent nearly $2,500 for a two-week trip to Bolivia’s capital city, La Paz.  We were there much longer than anticipated due to delays getting my resident visa.  But, we did take advantage of the trip to see the sights in La Paz, and we took three excursions to Lake Titicaca, the Cloud Forest, and pre-Inca ruins at Tiwanaku.

 

Considering we were staying in hotels, eating at restaurants, and travelling for two weeks, including flights, $2,500 is damn cheap.  We’re a bit under budget in the travel category so far – $68 under budget for two months.

 

Resident Visa

We didn’t anticipate it would be so difficult to get my resident visa, which will allow me to stay in the country for a year.  We ended up paying nearly $1,000 for the visa and some related documents – mostly that was for lawyer fees.  Unfortunately, we didn’t budget anything for this, so it was a pure budget overspend.

 

The good news is that this is a one-time event.  It’s not going to continue digging a hole in our budget.

 

Medical

Here’s another area where, surprisingly, we didn’t budget anything.  I suppose I figured we wouldn’t have significant medical expenses, other than a few band-aids and cough medicine.  We’re all healthy with no major medical issues.  And our initial plan was to go without any health insurance.

 

That’s changed.  At the last minute, we ended up buying some catastrophic travel/medivac insurance for $871 (covering 6-months).  It covers the family for up to $300,000 of hospital bills or medical evacuation costs, should there be some sort of accident or medical problem.

 

In addition to the insurance, we are doing some pretty serious dental work.  My daughter is getting braces, a root canal for my wife, and my son is getting some teeth pulled, with braces probably in his near future.  By doing these things in Bolivia, we save some serious coin over what we would have paid in the U.S.   For example, the root canal only cost $50, and six months of braces cost $275 – with no dental insurance!  Talk about cheap! I just can’t figure out why I didn’t budget for it – my bad.

 

Between the insurance and the dental work, we’ve spent $1,035 on medical stuff so far, with undoubtedly more to come.  This will keep eating a whole in our budget.  But, since we are well under budget is almost every other category, it’s not a problem.

 

Long Term Storage

We budgeted a total of $3,000 to store our worldly belongings in San Diego for the year.  But, since we ended up using two storage pods instead of three, we are going to be under budget here too.  After two months, we had expected to spend $500 on long-term storage, but we’ve only spent $397.  That leaves a favorable budget variance of just over $100 – and it will keep getting better as our cost is locked in.

 

Other than the long-term storage pods, we have no other expenses back in California during our gap year.  We have no cars, no ongoing memberships, or any other type of expense.  Our house in California is rented, but the rent is really just enough to cover the mortgage, insurance, property manager, and taxes.  So, to keep things simple, I’m ignoring the income and costs associated with our California house.

 

Living In Our Pueblo

This is what most people want to know about – how much does it cost just to live in our pueblo?  The answer is: not very much.  We budgeted $10,000 for the year to cover our basic living – food, supplies, utilities, transportation, etc – that’s $833 per month.  This is meant to cover all of our expenses while we are in our village or the nearest city.

 

So far, we are a little under budget in this category too.  After two months, we expected to spend $1,667, but we’ve only spent $1,402 – that’s $700 per month.  Thus, we are $265 under budget so far.

 

What have we spent it on? It’s tough to get very granular, because all our spending is in cash (credit cards are not a thing here).  Short of writing down every single expense (no thank you), I have to do my best to estimate.

 

Food and Housing

Our biggest expense has been for food and drinks.  We’re probably spending $100 per week on food so far, but I expect that to go down soon.  There’s an upfront cost here, because we’ve been stocking our kitchen.

 

We have no rent expense, since we already own the house in our village.  Undoubtedly, we’d be spending more if we were renting.  For reference, we could probably rent a similar house for about $100-200 per month.

 

Internet

The next largest expense, by far, is internet.  We’ve spent close to $350 on internet access so far.  The only internet access here is via cell service, and it is quite expensive.  I have been doing some remote work for my old employer (you can quit, but you cannot be free!), and most of our internet use has been to support that.  If I weren’t working remotely, we would have spent much less on internet.  The good news is that even though the internet is expensive, I’ve made more than enough money to pay for it.  So, it is not much of a concern.

 

Other

Other living expenses have included transportation costs to and from the city (about $150 for several trips), seeds and other supplies for planting vegetables in our farm ($150), and then a bunch of other miscellaneous stuff – utilities, school supplies, and who knows what else.

 

There are undoubtedly upfront costs to living in our village.  As we stay more time here, our monthly costs should go down.  Although it has cost us about $700 per month for the first two months, I expect we will soon be spending less than $500 per month to live in our village.

 

Gap Year Budget Update – Closing Thoughts

So, while there have been about $2k of unexpected expenses (resident visa and medical), we are otherwise under budget in every other category.  Mostly because we saved over $4k on our initial flights to Bolivia, we’ve got a giant cushion at this point.  It appears that we could likely come in well under the total $40k budget for the year.  Or, we may just end up spending more on our travels instead!

 

Cheers,

Jojo Bobo

 

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