Comparing Cost of Living in USA and Nicaragua: It will surprise you!


“Everything costs something.”
Zara Hairston

When we lived in Nicaragua, we occasionally referred to ourselves as economic refugees. We took early retirement and lived off our small teaching pensions. We did everything financial experts advised to prepare for living abroad such as, becoming debt free, having an emergency medical fund, purchasing international health insurance plans, saving money for unexpected emergencies like trips back to the states to help our families, and living within our budget.

Thank goodness we didn’t burn any bridges. We rented our house in the states and kept our stateside bank account and address, which was important in keeping our U.S. credit card.  We were legal residents of Nicaragua and Tennessee and had the best of both worlds.

When the Nicaraguan crisis and Ron’s lumps in his neck made us reconsider moving back to the states, we were concerned about the cost of living after spending more than 10 years abroad with cheap, cheap living and all the comforts of home.

What we learned surprised us!

Most retired expats in Nicaragua will tell you that their main reason for moving abroad was affordability. They said they had a hard time living on a fixed income in their home countries.

But, what they don’t tell you is that everything costs something! It is cheap because there is no quality control, the education system does not prepare employees to be productive and skilled laborers, the infrastructure such as roads, utilities, and internet are pitifully unreliable (and many times unsafe), and most materials and foods imported come with a hefty price tag. In other words, you get what you pay for…and it isn’t much!

So, I made a comparison of the cost of living in Nicaragua and the USA for the month of February. I used eight general categories and color coded them the same in each pie graph.

The monthly cost of living in our home in TN is $1,626.20. The largest slice was miscellaneous, which included paying off our credit card in full each month. We rarely use cash here and pay for almost everything with our credit card. I missed that so much in Nicaragua, because I can always accumulate enough reward points to pay for several airline tickets.

Surprisingly, several items are cheaper in the states, like gasoline for transportation. It is $1.80 per gallon with my grocery store discount card. The package deal for fast internet ( I mean really, really fast…100 mbps) and cable TV is $101.24 a month. I paid much more in Nicaragua for the internet, not including the maintenance of a very tall microwave tower that was always breaking. And…AND…the speed, if we were lucky, was 8 mbps, when the system was working. The internet blinked on and off daily many, many times.

We have a heat pump and several small portable electric room heaters for the winter months. February is usually the most expensive electric bill according to our past usage. In the summer, we have whole house air conditioning and our electricity averages $75. Most of the time we don’t use the air conditioning. We prefer opening the windows and every room has ceiling fans and window fans.

We own our house in TN and are mortgage free. Rents are reasonable in our small town, averaging $871 per month for a 1 bedroom house or apartment. For a single person a monthly cost of living on average is $1,600.

 

In Nicaragua, our monthly expenditures were  $1,341.00 Our cell phones were cheaper… we had two cell phones and only one with unlimited data from  Claro. The data transmitted was only 3g and service was spotty depending on where we were in Nicaragua. In the states, I have 4g and unlimited data with free calls and text in the U.S., Canada, and Mexico with AT&T prepay.

Transportation was more expensive in Nicaragua for two reasons. Gasoline is very expensive and taxis are expensive. Usually, we took a monthly trip to Managua with our taxi driver, Francisco. The cost round trip was $60 and we tipped him $10 and bought him lunch.

Although we had an abundance of fruits on our property, we enjoyed some imported foods like peanut butter, dill pickles, chocolate, and wine, which increased our monthly food expenditures.

Nicaragua is a cash society. We seldom used a credit card. Our miscellaneous fees included propane for cooking, house repairs, and workers.

We still support our goddaughter and my children’s library and librarian, so that has not changed.

 

Overall, the difference in monthly costs is about $300. When the weather warms, our electric will go way down and make up much of the difference. We can reduce our monthly internet/cable TV service by cutting the cable cord. The only reason we have cable TV is so Ron could watch his sports throughout the long winter cancer treatments. We can stream everything we want to watch, so the cable will be cut soon.

Our annual expenses are comparable in some areas, and more expensive in others.

Comparable:

1. International health insurance in Nicaragua and Medicare with Medicare supplemental insurance in the U.S.

2. VPN service for our internet remains the same.

3. Amazon Prime yearly bill is the same, but living in the states we have used it so much more for free shipping and streaming movies.

More expensive:

1. Property taxes $650 yearly in the states vs $60 in Nicaragua.

2. Car insurance is much more in the states. We bought and paid cash for a car when we returned…and we have to have car insurance. In Nicaragua, we had our dune buggy and our motorcycle insured for $75 a year. However, there is no telling what the insurance would have covered if we had an accident in Nicaragua.

In making comparisons, the best decisions we made were to pay off our mortgage in the states and buy our house in Nicaragua. Our house is rented in Nicaragua now. The worst case scenario would be that our house in Nicaragua would be confiscated by the government. If that would happen, because of our wise financial decisions, we would not suffer, nor would our retirement  funds be affected. We are not in any hurry to sell our place, nor do we feel pressure to sell. Although we will probably not return to live in Nicaragua, we have no regrets about financial decisions we have made throughout our lives.

It feels kind of weird to say we aren’t expats any longer. But, we are redefining the term expat. Possibly global citizens would be a better term. I’m in the process of writing a post about that. Stay tuned while we rewire.

 

 

 

Thankful, Cautious, Shrewd, and Charitable


“Be happy when you work, thankful when you earn, cautious when you spend, shrewd when you save, and charitable when you give.”
― Matshona Dhliwayo

This is a quote we live by…our mantra for financial security and happiness.
We leave for Uruguay and Argentina next week, so I have to prepare for our house sitter, which includes paying bills and planning ahead financially.

It is always a good time for me to report on our monthly expenses because I have receipts and bills spread out on my kitchen table. This time, I am dividing our financial “happiness” into four categories. Let me explain how this works for us. But, first a breakdown of February 2018 expenses.

Total February 2018 expenses = $1,467 Plus, $31 a month for SKY TV.  I forgot to include SKY when I made the pie graph because it is the only bill we pay with our credit card and I didn’t want to make a new pie chart.

My children’s library topped our expenses this month because I gave my librarian a raise and put him on a yearly salary including health insurance. Then, our internet provider GGnet, graciously provided my library with free internet if I would purchase the equipment.  The dish, cable, router, special surge protector, and installation was $500…but well worth the expense to open the door to the world of education through technology for the teachers and students.

The utilities include water ($3), electric ($58), internet ($115), phone plan ($52), and SKY satellite TV ($31).

The monthly university tuition for our goddaughter is $100. That includes her food, lodging, and books and materials she needs. She is starting her third year of university in March. She is a communication and theater major in Leon and we are so proud of her.

Our property taxes are due once a year. If we pay before March 15th, we get a 10% discount. $39 for two houses and 2 1/2 acres of beach front property on the lake. Not bad, huh?

Miscellaneous includes a bottle of propane, gas for the motorcycle, and emergency money for our house sitter.

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The Concept of Just One in Nicaragua


Just one step. Just one mile. Just one dollar. Just one kiss. Just one person. When we look at life through the lens of ‘one,’ everything becomes that much more attainable. ~Mark Ebeling

The other day, I ran out of ink for my printer. Since there was no ink available for my printer on Ometepe Island, I sent Maxwell, my librarian, to the mainland to buy ink. It is time to make him a new work contract, so I figured he would be happy to ferry to the mainland so I could print him a new contract…and he was!

I gave him an old cartridge and asked him to buy just one black cartridge. He called from the mainland to ask me, “Do you want the $13 cartridge or the $35 cartridge?” “What’s the difference?” I asked. “One cartridge is 1/4 full of ink and the other is full of ink,” he said.

I laughed because I had never heard of selling an ink cartridge only 1/4 full. I told him to buy the $35 black ink and a 1/4 full tricolor ink because who knows when we will have to replenish the ink supply and make another trip to the mainland.

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Love Your Country or Leave It?


“Loyalty to country ALWAYS. Loyalty to government, when it deserves it.”
― Mark Twain

Usually one of the first questions I am asked about being an expat besides the “What do you do in Nicaragua?” or “Are you a missionary?” is “Why did you leave America?”

My response is that I never left America. I am still here. I live in Central America. If that doesn’t piss them off, then I could say that I am a political refugee from the Divided States of America. But, I never say that because first, it is a lie, and second, I love my homeland and I really don’t like to create tension or controversy unless it is a last resort. I am a mediator at heart, I seek peace.

So, when angry people respond to me in a political discussion, “Love it, or leave it!” what is the appropriate response? Why is it that expats are seen as less patriotic than those who stayed in their home country? Can expats be patriotic? If so, how?

Photo credit to Larry Wilkinson

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Can Expats Live Without These Things?


“If all you do is think about what you need, you’re no better than an animal in the woods, and no smarter either. To be human, you’ve got to want. It makes you smarter and stronger.”
― Dan Groat

Ron is always telling me I want too much. But, I agree that to want makes me human. It makes me smarter and stronger.  I remember the argument we had about buying an oven when we moved to Nicaragua. We both like to bake, so why was it so difficult to convince him that I wanted an oven?

Now, I do understand the difference between wants and needs. Yet, as an expat there are 14 things I can’t live without. Tropical Storm Nate convinced me that my wants usually lead to my needs.

1. Shelter

We’ve made a comfortable boomer nest in Nicaragua. But, when Nate roared through Ometepe our roof struggled to maintain its composure. The old tin roof tried its best over years with fruits pounding on the hot tin and constant leaks during the rainy season. But, it is time for a new roof.

If you watched our House Hunter’s International show, you know I like “funky”. A new roof is a ‘need’, but I have many ‘wants’ to paint, redecorate, and spruce up our little nest. We are still debating on whether to sell our place and move to more adventures. Meanwhile, I want a comfortable, low maintenance home base. And if we do decide to sell, our beautiful property will be ready for new owners.

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Pondering Progress in Nicaragua


“The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little.”
― Franklin D. Roosevelt

Economic growth is one of the main factors in determining the progress of a country and its potential to satisfy the wants of individuals in their society. I am convinced Nicaragua has made significant progress in utilizing their abundance of natural resources to produce more efficient wind and solar energy. Technological development has played a role in Nicaragua to connect the population to the outside world through fiber optic internet cables. Ometepe Island public parks now have free wi-fi access due to a fiber optic cable strung under the lake from the mainland.

Yet, I wonder if all progress and advancements I see in Nicaragua truly benefit the majority of the people living below the poverty line. Are we adding to the abundance of the minority of Nicaraguans who have so much, and are we providing enough to the majority who have so little?

Last week I traveled to Managua for my regular check-up with my eye doctor. Arriving at the port in San Jorge, I noticed a new ferry, a desperately needed ferry because many people on Ometepe Island must travel to the mainland daily for work. This progress benefits everyone. And I have seen much growth in transportation with new airports, shuttles, taxis, and lots of cute tuk tuks that buzz around newly constructed roads like little mosquitoes.
The San Jorge port had a magnificent facelift. Restaurants, vendors, hotels, and major work on the sea walls benefits everyone, too.
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Gypsytoes or Stickytoes


This says it all about our lives on Ometepe Island. We want the best of all worlds. How does one decide to stay or go? Is it possible to have Gypsytoes and Stickytoes  together? If so, how does that work?

Here are some of our considerations in deciding to stay or go.

Financial

 

We grow a lot of our fruits and vegetables.

In 2016, we traveled to Colombia, Fiji, New Zealand, Las Vegas, Tennessee, and Pennsylvania. We accounted for all of our expenses and income for 2016, and we actually saved money and came out ahead when we balanced income vs expenses.  We own two homes, we have no mortgages and no expenses for our home in the states. Our trusted friends live in our house, collect our mail, and they even took care of our old cat, Tokyo, until she passed away this year. The small amount of rent goes into a special account which we use to pay our property taxes, rental insurance, and for repairs on the house.

If we were to sell our house on Ometepe Island, we would be free to travel the world, but it would come with a price. We would continue to live only on our monthly income, and try not to dip into our savings, yet it would be difficult because we would have to pay a monthly rental fee, which we don’t have to now. Traveling is expensive. We aren’t backpackers anymore, and we like to stay in Airbnbs throughout the world. It is doable, but will take some work to stay within our budget.

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Out of Nicaragua


“One does not travel by plane. One is merely sent, like a parcel.” ― Karen Blixen

We’ve been out of Nicaragua for three months. It is the longest time we have been away in the seven years that we have permanently lived here. Three countries, 16 airplanes, two trains, three ferries, two rental cars, too many buses to count, and one eye operation later…we are finally home!

My impressions of the countries we visited are dependent on many factors such as economic, political, climate, and most important…the people we met from all walks of life. In every country we visit we ask,”Could we live here?” The answer often surprises us. Yet, it helps us to form lasting impressions of the country.

Could we live in Cuba?

Foremost, we are grateful we had the opportunity to visit Cuba in March before Trump’s Cuba policy redefined “good” U.S. tourism. We are and always will be independent travelers. In most packaged tours and cruises, you see what the tour companies want you to see…predictable, expensive, and unsustainable tourism. Instead, we like to explore as detectives searching for clues about why people live as they do, what the real culture is like, and what makes a country tick.

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Cost of Living: March 2017


Since I am preparing envelopes for our house sitters with two and a half months of expenses, I thought I would give you an idea of our latest cost of living expenses for the month of March 2017.

We own our home, thus no rental expenses. This month, we paid our property taxes of $25 and I included that in the miscellaneous expenses along with gas, propane, and a few other small expenses.

The amounts are in dollars. The total monthly expenses are: $960.

screen-shot-2017-03-05-at-9-40-23-pm

If you are considering living in Nicaragua, it will depend on your location and your needs. Ometepe Island is cheaper for home rentals than most of the larger cities like Granada and San Juan Del Sur. But, there are some expenses that cost more, such as a rural internet provider since we don’t have cable internet available outside of the main cities. Our service provider is Ggnet and it is on the mainland. We built a tall tower in our backyard because we need direct line of sight to the mainland to receive a strong signal for our microwave internet system.

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How to Afford to Travel


“Desires dictate our priorities, priorities shape our choices, and choices determine our actions.” ― Dallin H. Oaks

I love reading travel essays, but before we started traveling I was disappointed when the essays never explained how one affords to travel. I received a comment on my blog the other day asking me how we afford to travel six months of the year and live abroad.

I never gave that question much thought after we started traveling because we just did it, but it is a great question and one that I think deserves a thoughtful answer.

Let me break down the quote above because it explains our process perfectly.

arthurs-pass

Arthur’s Pass in the New Zealand Southern Alps.

 

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