You Might Be FI Already…If You Lived Somewhere Else (Geographic Arbitrage)

(the cover picture was taken in an old salt mine that was converted into an amusement park in Turda, Transylvania)

This year we decided to spend Christmas with my parents in Romania. For the past 6-7 years we always had some sort of excuse not to go there in the winter (like flying to a warmer continent, visiting Mrs W’s parents in Scotland, giving birth, etc). This year we decided it’s time for Christmas in Romania and do some geographic arbitrage*!

Since we’re both boss-free, we didn’t have to ask permission from anybody, didn’t have to work until the 23rd of December and then catch the last flight. We travelled on a Monday, at the beginning of December, avoiding those crazy plane ticket prices and all the travel chaos that goes on as the big day approaches.

Travelling with two kids and using virtually all possible means of transportation, we didn’t have an easy day but eventually we arrived safely at my parents’ house near Timisoara. If you could have seen our faces that evening at the dinner table…oh maaaan. What a relief! What a meal! And from that very moment on, the professional babysitters (aka grandparents) took over full control of the kids, meal planning and everything else. Basically everybody is happy! How amazing is that! FREEEDOOOM!

This year we already spent three months here over the spring/summer. We will do that every year while it’s still possible before we become slaves to the German school system. We love it here. We love to see how our kids and my parents make each other happy all day every day! It’s sooo good to be so much closer to family, nature, the garden, animals. It’s good to have this counterbalance to our life in the centre of a big city. And of course we love it! Grandparents are the greatest invention of mankind! 🙂

Should We Move to Romania?

My dad'd Wine and Pálinka production - only for family consumption

My Dad’s wine and pálinka (grappa) reserves – only for family consumption of course

This summer we talked about it a lot. On the one hand, it would make a lot of sense for a number of reasons:

  • We would be closer to my parents.
  • The kids love it here.
  • My parents would love it.
  • Our daughter loves the kindergarten here.
  • Even Mrs W loves it here.
  • When we work, we work from home anyway.
  • When I want to visit a customer, I can just fly there from here.
  • The internet (which is an essential requirement for life on Earth) is fantastically fast (200mbits/s, fibre optic!!!) – this sort of speed is basically unheard-of even in major western european cities. Over here: it’s standard. This company doesn’t even offer you anything slower than that. You can have 500mbits though if you want to be a bit special ans show off.
  • We’d be closer to nature.
  • We could learn/use proper life skills like maintaining a garden, repairing stuff round the house, killing some animals we want to eat, etc.
  • Our living expenses would drop significantly to probably somewhere around 10-15K a year.
  • If we decided to rent out our Stuttgart flat (furnished), that would be a massive dollop of icing on the cake!

Why NOT Move to Romania?

On the other hand, we’ve been living in Germany for 10 years now and leaving behind all the social contacts, German health insurance and standards wouldn’t be easy at all.

Mostly it’s the health insurance that really is a huge problem.

In Romania, when you go to the doctor you need to pay virtually everybody who has anything to do with your situation: from the lady who cleans your room to the doctors who treat you. You basically need to bribe them. In many cases (there are exceptions) they just don’t care about you if you don’t hand them an envelope.

It’s a weird undocumented system where there are no official prices for services and you need to ask around in the hospital to know how much bribe money you have to pay to whom. It doesn’t matter whether or not you paid health insurance. It has no value! Some of the best doctors only work in public hospitals so they can invite the patients to their private clinics.

It gets worse: the hospitals are so underequipped that (and this was the case recently, I don’t know if it’s still true in every hospital) they might send you to the next pharmacy to buy the syringes and other things they’re going to use on you.

Not all hospitals are the same. The one we have here in my home town is a good exception, but still you don’t want to spend a night there. Let’s not even talk about hygiene and food!

If you have a serious problem: cancer, brain tumour, etc, you want to be in a different country. And you want to be insured there.

One of my friends from university had to have brain surgery. She had to beg lots of people to raise €30,000 so she could have the operation in Germany. The health insurance was no help. Luckily her employer (a bank) helped her too and she got the money together. She had her operation and she’s ok. But do you want to be in this sort of situation? I don’t.

This might sound weird for US citizens, but in Germany this is not an issue. The system is still far from perfect but everybody has health insurance and everybody gets more or less the same benefits. And that’s how it should be.

So, you can see now that there’s something that holds us back from moving to Romania. It’s not a knockout criterion though. In the vast majority of possible medical cases, we could live with the system. Only if we had bigger issues and needed a complex operation or something, we might have to go to Hungary or somewhere else.

And then there’s the corruption thing. You don’t have to deal with it in your day-to-day life…but corruption is eating up this country. I don’t really want to live in this environment.

Anyway…we decided not to move to Romania. Yet. That’s just us though, and our specific situation/mindset at this moment.

But what about other people?

Do You Want To Be Financially Independent Instantly? Maybe you are!

Ordinary people here take home about €300 a month. If you have a good job, let’s double that to €600. Let’s say that as a family you take home €1000 a month and you spend it all. That means your expenses are about €12,000 a year. This includes EVERYTHING. Even package holidays in Greece, Croatia or so if you like.

If you can imagine living in Romania – and really, it’s not such a bad place to be – let’s play with some thoughts:

Scenario 1: You’re a Freelancer

If you are a freelancer somewhere in Western Europe, you have an hourly rate of around €80-130. Let’s say €100. You need to work for 150 hours to cover all your family’s expenses in Romania for one year. Let’s double that so you have a massive buffer and you’re still at only 300 hours, which is 37.5 working days – a YEAR!

Ok, it’s not FI but it’s not a 9-to-5 job either.

Scenario 2: You Own a Nice Property in a German City

Let’s take our situation. We paid off our flat in Germany (wasn’t a back-breaking performance). If we rented our flat out now, fully furnished, we would get about €1200-1400 a month plus expenses. Pretty easily.

For that sort of income we would not even be taxed in Germany. In Romania we would, but not all that much.

And hey presto, that’s us financially independent!

Scenario 3: You Start a Website About Photography

If you love photography, why not start a website about it? Build your community, start some Facebook groups/pages, write some relevant content, look for good camera/lens deals and share them. In a year you have enough visitors to generate nice AdSense income and advertisers will start contacting you and paying you for leads or banners. All in all it is quite easy to generate €1000 of income a month.

If you then find ways to automate/outsource most of the work…you are floating…and can live happily in Romania for ever!


Geographic arbitrage*, or the idea of earning money in a rich country or online and living in a relatively cheap place is not new, but I don’t think people really consider it often enough.

Of course, if you have school-age kids moving to a new country is not easy to imagine – almost impossible even – but there are so many young people who are flexible enough to take that step (JUST DON’T FU**ING TAKE OUT ANY STUDENT LOANS PEOPLE! PLEASE!).

People are generally afraid of new languages, new countries, new cultures. These problems are easier to overcome than you would imagine if you just have the right motivation and mindset. And becoming (almost) completely FREE is hell of a motivating!

The question is: how quickly do you want to become free? If you continue living in an expensive country, the journey to FI could be significantly longer compared to a cheaper place. And you don’t necessarily have to give up any quality of life!

The cost of living can vary enormously even between EU countries. We all know that. But many people are scared of the thought of living any further east than Austria. If I think of, let’s say, Budapest, which is one of the most beautiful and vibrant cities on Earth, it’s still lot more affordable than its close neighbour Vienna.

It’s worth thinking about a move! What do you think? Can you imagine moving somewhere cheaper? If so, where?

Us frying home made sausages in the fireplace. Good stuff!

Us cooking home-made sausages in the fireplace. Good stuff!

* you can also check out the geographic arbitrage posts at MadFientist and  J.D. Roth’s post on his blog “Get Rich Slowly” about geographic arbitrage.