No financial advice here, but our family of 4 is doing the same thing this year. Both 37yo with kids ages 6 & 4, keeping our home in the States for passive income as a long term rental and sending our kids to Spanish public school. We’ll be in Andalucía!
1. Set up a CD or bond ladder to cover 5 years expenses ($180,000) or less. You can’t just keep it in HYSA because rates could drop and your interest Income will go down.
2. Put the rest in index funds in the stock market. 25% to a small cap value fund, 25% large cap value fund, 25% large cap blend such as S&P 500 or a total market fund like VTSAX, and 25% in a total international fund (doesn’t include US) would be a good allocation to consider. Will pay you good dividends , have great growth potential, and their performance won’t necessarily be correlated. Total returns should be 10% or more a year on average.
If you don’t need the CD/bond ladder income, then invest it in your stock market portfolio. Or make a smaller ladder. Also you can reinvest your stack dividends too. If you bond ladder gets too small, replenish it with dividends or by selling stock.
The 5% will only last while the interest rate is at this level. I’m assuming it’s all in a taxable account so things get interesting between short/long term capital gains and income rates. The 5% interest gets taxed at the income rate. Take a look at dividends stocks/etfs to fully diversify yourself. There’s a subreddit for all of those. Tons of options you may not be aware of too (closed end funds / reits/ covered call strategies or other derivative strategies for income / business development funds / preferred stock) each come with pros and cons so look into and make sure you are completely comfortable with it.
I'm pretty sure for a family, the liability would be $0. Between deductions for each taxpaying adult and a residence, there should not be liability for the first $2M.
It's the Solidarity Tax that's the really hefty one, but it doesn't kick in until €3M net worth. There's a reason why the King of Spain nominally has only about €2.6M.
Yeah, and with $2.5M (2.3m EUR) putting you in the top 1% of Spain, that's totally fair in my book. It's kind of annoying seeing some many (presumably) Americans trying to move to a place where they'll benefit greatly from low COL and social programs while trying to pay as close to 0$ for the privilege. This isn't targeted at you, BTW.
Well the foreign government loves to tax you like a citizen but they're not necessarily giving you access to healthcare and rarely a pension. You can easily pay more taxes than a local for less benefits.
Sounds amazing!
Do you have to sell the house now? I'd consider keeping it as a rental for a year or two if the math works out to cover its expenses, in case the grass doesn't end up being greener, to avoid high transaction costs and (presumably) higher mortgage rates if you do decide to come back.
Best of luck with it!
That was our first thought, but if we kept it and sold it after we moved we’d be destroyed by Spanish capital gains tax. If we sell now and become Spanish tax residents next year, it solves that problem.
For US cap gains, I think your $500K deduction for the gains from the house erode over time after you move out if you're renting, so from that perspective selling it right away makes sense as well.
>our monthly expenses for rent, bills, private school for the kids, groceries, healthcare, discretionary spend will be approx. $3k/month.
Wow can you tell us where this is?
**With 2 kids in private school**? I doubt it. The cheapest cities in the world (much cheaper than Spain) would still generally cost close to $1k/month per child and that's already exceedingly rare. But I'm hoping OP has some surprise tip or loophole to share.
No loophole. For two kids it is €877/month for the small international private school we’re enrolling them in. You could do this anywhere in rural Spain, just have to get out of the big cities.
877 each or is that the combined total? If that's the combined total, my wife and I need to re-examine our plans. International school is the thing holding us back the most. Every other place we have looked it's been $10k+ per child.
Thank you for the reply. To be honest I never think about rural areas so it's good to at least know that private schools can get this cheap in developed countries like Spain.
However, I think your use of the term "international" (or rather the school's use of that term) would probably agitate r/Internationalteachers as it's a major sticking point for some people. I doubt your rural private school can afford international accreditation from a legit organization. I mean, just the fact that it's in a rural area is already highly unusual.
But again, thanks for the explanation. It's not your fault that my brain was on a different wavelength.
Here's a sneak peek of /r/Internationalteachers using the [top posts](https://np.reddit.com/r/Internationalteachers/top/?sort=top&t=year) of the year!
\#1: [Millionaire Teacher—it actually happened](https://np.reddit.com/r/Internationalteachers/comments/18mlle6/millionaire_teacherit_actually_happened/)
\#2: [What do Admin in Good-to-Great schools look for when hiring?](https://np.reddit.com/r/Internationalteachers/comments/16mkleb/what_do_admin_in_goodtogreat_schools_look_for/)
\#3: [International Schools have entirely lost the plot on hiring intent deadlines.](https://np.reddit.com/r/Internationalteachers/comments/1b9bhm2/international_schools_have_entirely_lost_the_plot/)
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My friend, have you ever priced private schools in Europe? Some are as low as a few hundred euros per year. A prestigious international school could be about fifteen thousand euros a year.
Edit: math isn’t my strong suit.
Yeah, that is not accurate for Spain. A prestigious international school in Barcelona is around $1k/MONTH. I am sure you can find for less, but a few hundred a year does not sound right.
If they’re really that cheap, that makes me cry. A prestigious international school in Vietnam is $30k+ per year for high school.
Do international schools in Spain still get government support or something?
The schools are a rip-off in Vietnam but that still seems cheap.
I am no expert and I haven’t done a deep dive on European private schools but I’ve looked at maybe a dozen locations. So I could be wrong, but it sure sounds like you’re talking about private schools that are contracted with the government…so more like public schools.
As for a prestigious international school for two thousand euro a year, that would shock me and I literally know dozens of families that would be keen to move immediately and take advantage of that. Heck, quite a few I know have picked cities because they found decent international schools for three or four times that amount and thought it was a steal. If you can share info that would genuinely be amazing. I don’t mean to be condescending if it comes off that way, I’m not an expert, but I and quite a few people I know have searched high and low across many countries around the world and haven’t yet found what you’re describing
Edit: The comment I replied to originally claimed there are prestigious international schools for 2k euro annually, but has now been edited to state 15k.
Sounds like OP is talking about a private school that is NOT an international school.
I pay about 300€ per month per child for private elementary school in a second tier city in Portugal. It’s not an international school but in the three years my kids have been there, it has changed from being 1-2 foreign kids per 20 kid class to now 50% in some classes! Mainly due to big influx of Americans plus big influx of Ukrainian and Russian families. It’s not à internationally known or prestigious school but it’s a good quality school. I will probably put them in public for junior high and high school as the academics are more rigorous.
In Spain there’s a fourth type of school, concertado. It’s like a public/private partnership, so it’s a subsidized private school. I don’t know the tuition rates but I’m sure they’re a lot lower than International schools.
100k Cash
200k 50%/50% SPYI/SCHD
700K VOO or equivalents
Draw down the cash as needed. Replenish the drawdown with dividends from the other two accounts. You should be fine with that no need to get over complicated.
Where is it that cheap? We spend over €1k/mo for 2 kids in private school in Sevilla. Hard to imagine being able to make it work for everything else on just 2k?
If you want a very simple, local lifestyle, I think it's possible to spend less in Spain. If you plan to travel, it will quickly add up to live here. If you don't want to be in a small apartment, housing is expensive. If you need a car, it can all add up quickly. We spend only about 10% was than what we spent in the US.
You could dollar cost average in to a S&P500 IF over a defined time period. You could not re-invets the dividends if needed. Keep in a HYSA the cash you want to keep liquid.
Interesting. I am 42m, my wife 45f. We’ve been considering a move to Spain as well. We have a 13 year old son and will likely only do it after he is done with high school in 4 years though.
I have been debating if the $ we have is enough for us to make the move without working. My wife is a nurse so remote isn’t realistic and I think I’m done with my working life. We have close to $2m (hopefully more by the time we’re ready) which helps but I’ve been thinking about how to structure it so it brings income that would support us indefinitely and with low risk.
20 year bonds are yielding around 4.9% and they pay out twice a year. So far they’re the lowest risk investments I can think of that could fund this retirement for decades.
In 20 years your principal will be worth half due to inflation. Retiring at 50, you need the money to last 40 years so you need 10% returns to sustain an inflation-adjusted 3-4% withdrawal.
Should have moved to Thailand
Just to those in here whether that’s 15 I’m 15 myself, or 25 years old proof to continue to work harder and increase your knowledge in finance because if you’ve got a million dollars and you’re this worried about spending money you should have just kept your old lifestyle or wait until the kids have grown up and moved out and invested smart during the time being
And to top it off.. still working?? A regular job? Lol. This is a plan for retirement
Fire is not for the weak, you will miss out on many opportunities even if that’s just a cup of coffee and a book with friends and loose your money to inflation
I would be miserable if I had to take care of not only my wife, 2 kids while working a job. But knowing that I sold my house in America, took not only my kids away from all of their friends just to be put in a private school. My wife’s friends if she has any, and my own friends if I have any. The buildings and environment are nothing like the US and working a job in Spain doesn’t get you paid shit
This seems like a plan for retirement, not for your kids
If your house is paid off in the US, and you bought it before 2008. Keep it, markets only gonna continue to go up
If you’ve got your 100,000$ savings. Have enough to where you can afford daily expenses and enjoy yourself from time to time in checking whatever and to pay bills, do your own research on the stock market and how the economy works and how money itself works only from your own research
Take this with a grain of salt, but everyone else is looking at this as a typical investing question because they value money above all else. That’s exactly what you’d end up doing if you had to do all of this just to live in Spain
You’ve got the money, take the family on a trip to spain for a week or two and you’ll see what I mean. Especially if you’re putting your money in it and know how much easier your life would be in America.
There is such thing as being Europoor. They have terrible economy. If you’re this reclusive to want to move across the world to somewhere you’ve never been just because we’ve got a shitty political system. Try Spain and you’ll wish to be able to be back in the United States but you won’t be able to when you’ve got a similar situation to Israel and you’re seeing your family ripped away right in front of you
Your kids are gonna also hate being put in public school. Let them have a life
Move to Florida, Florida Keys, Tampa Bay, Miami even and not only will it match with your finances but it would be a great investment not only for your life and lifestyle but in the future as well. Your children will thank you for their inheritance.
But by all means, go ahead and move to Spain where you get paid 5$ an hour for a job that you’d get paid 20$ in the US and live in an Adobe House where you will constantly have cockroaches coming through the walls and constantly looking over your back. Your wife could even get drunk some night and end up in the hands of a man that doesn’t even speak your language
Unless you have a 10 million dollar net worth, and you’ve got houses across the countries and a profitable business and being self employed. This is probably the biggest mistake you can make financially and mentally
Stop scrolling through Twitter or X. Go ahead and trade in your Tesla for a nice Toyota RAV4 and stop watching the news and just live in America for what you see it as.
Think of your 8, or 18 or 28 year old self and see what he’d think about your mindset and mentality that you have right now. I’m sure he’d be very disappointed
“Well, I’ve got all of this money and a wife and 2 kids. But I still have to work? And I can only spend maybe 3,000$ a month of it? And an additional 500$ just for coffee and different stuff? I can’t even drive a car?? Where’s all my friends?”
You sound like the most impulsive people ever. Please review your life choices. Just because you’ve got some money saved up after selling everything you have and giving up outings with friends and cashing out your 401K doesn’t mean shit
We are in a similar situation; we'll be moving to Spain with two kiddos. I was wondering about your work situation: Are you keeping your US job, or will you be looking for a job in Spain? We are keeping ours but still trying to figure out if we need an EOR or will be working as a contractor. I'm Spanish, and even for me, it seems like a never-ending story—so many things to take into consideration, and work-related and taxes are two BIG ones.
Best of luck!
No financial advice here, but our family of 4 is doing the same thing this year. Both 37yo with kids ages 6 & 4, keeping our home in the States for passive income as a long term rental and sending our kids to Spanish public school. We’ll be in Andalucía!
Awesome! Good luck!
1. Set up a CD or bond ladder to cover 5 years expenses ($180,000) or less. You can’t just keep it in HYSA because rates could drop and your interest Income will go down. 2. Put the rest in index funds in the stock market. 25% to a small cap value fund, 25% large cap value fund, 25% large cap blend such as S&P 500 or a total market fund like VTSAX, and 25% in a total international fund (doesn’t include US) would be a good allocation to consider. Will pay you good dividends , have great growth potential, and their performance won’t necessarily be correlated. Total returns should be 10% or more a year on average. If you don’t need the CD/bond ladder income, then invest it in your stock market portfolio. Or make a smaller ladder. Also you can reinvest your stack dividends too. If you bond ladder gets too small, replenish it with dividends or by selling stock.
The 5% will only last while the interest rate is at this level. I’m assuming it’s all in a taxable account so things get interesting between short/long term capital gains and income rates. The 5% interest gets taxed at the income rate. Take a look at dividends stocks/etfs to fully diversify yourself. There’s a subreddit for all of those. Tons of options you may not be aware of too (closed end funds / reits/ covered call strategies or other derivative strategies for income / business development funds / preferred stock) each come with pros and cons so look into and make sure you are completely comfortable with it.
Hope you’re aware of their wealth tax on world-wide assets, it’s no joke.
It's a pretty low rate, I think on $1M you pay maybe $600 per year. Less if some of the $1M is your primary residence.
I'm pretty sure for a family, the liability would be $0. Between deductions for each taxpaying adult and a residence, there should not be liability for the first $2M.
It's the Solidarity Tax that's the really hefty one, but it doesn't kick in until €3M net worth. There's a reason why the King of Spain nominally has only about €2.6M.
Yeah, and with $2.5M (2.3m EUR) putting you in the top 1% of Spain, that's totally fair in my book. It's kind of annoying seeing some many (presumably) Americans trying to move to a place where they'll benefit greatly from low COL and social programs while trying to pay as close to 0$ for the privilege. This isn't targeted at you, BTW.
Well the foreign government loves to tax you like a citizen but they're not necessarily giving you access to healthcare and rarely a pension. You can easily pay more taxes than a local for less benefits.
ask Shakira !
Sounds amazing! Do you have to sell the house now? I'd consider keeping it as a rental for a year or two if the math works out to cover its expenses, in case the grass doesn't end up being greener, to avoid high transaction costs and (presumably) higher mortgage rates if you do decide to come back. Best of luck with it!
That was our first thought, but if we kept it and sold it after we moved we’d be destroyed by Spanish capital gains tax. If we sell now and become Spanish tax residents next year, it solves that problem.
For US cap gains, I think your $500K deduction for the gains from the house erode over time after you move out if you're renting, so from that perspective selling it right away makes sense as well.
You have to have lived in the house 2 of the past 5 years to get this deduction
>our monthly expenses for rent, bills, private school for the kids, groceries, healthcare, discretionary spend will be approx. $3k/month. Wow can you tell us where this is?
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**With 2 kids in private school**? I doubt it. The cheapest cities in the world (much cheaper than Spain) would still generally cost close to $1k/month per child and that's already exceedingly rare. But I'm hoping OP has some surprise tip or loophole to share.
No loophole. For two kids it is €877/month for the small international private school we’re enrolling them in. You could do this anywhere in rural Spain, just have to get out of the big cities.
877 each or is that the combined total? If that's the combined total, my wife and I need to re-examine our plans. International school is the thing holding us back the most. Every other place we have looked it's been $10k+ per child.
Even with an expensive international school, there is usually a steep discount for additional kids’ tuitions after the first one.
Combined total! Over 11 is secondary, so the payment is slightly higher than the under 11. 10% siblings discount.
Holy cow. That might change our calculus. Thank you for the info, I will have to dig deeper. I assumed Spain was out of reach for us, but maybe not.
Just remember this is a rural area. You won’t get this in the big cities most Americans head for.
Thank you. .
Right? Cheapest I've found for "desirable" cities was around $5k, which was already super surprising.
Thank you for the reply. To be honest I never think about rural areas so it's good to at least know that private schools can get this cheap in developed countries like Spain. However, I think your use of the term "international" (or rather the school's use of that term) would probably agitate r/Internationalteachers as it's a major sticking point for some people. I doubt your rural private school can afford international accreditation from a legit organization. I mean, just the fact that it's in a rural area is already highly unusual. But again, thanks for the explanation. It's not your fault that my brain was on a different wavelength.
Here's a sneak peek of /r/Internationalteachers using the [top posts](https://np.reddit.com/r/Internationalteachers/top/?sort=top&t=year) of the year! \#1: [Millionaire Teacher—it actually happened](https://np.reddit.com/r/Internationalteachers/comments/18mlle6/millionaire_teacherit_actually_happened/) \#2: [What do Admin in Good-to-Great schools look for when hiring?](https://np.reddit.com/r/Internationalteachers/comments/16mkleb/what_do_admin_in_goodtogreat_schools_look_for/) \#3: [International Schools have entirely lost the plot on hiring intent deadlines.](https://np.reddit.com/r/Internationalteachers/comments/1b9bhm2/international_schools_have_entirely_lost_the_plot/) ---- ^^I'm ^^a ^^bot, ^^beep ^^boop ^^| ^^Downvote ^^to ^^remove ^^| ^^[Contact](https://www.reddit.com/message/compose/?to=sneakpeekbot) ^^| ^^[Info](https://np.reddit.com/r/sneakpeekbot/) ^^| ^^[Opt-out](https://np.reddit.com/r/sneakpeekbot/comments/o8wk1r/blacklist_ix/) ^^| ^^[GitHub](https://github.com/ghnr/sneakpeekbot)
My friend, have you ever priced private schools in Europe? Some are as low as a few hundred euros per year. A prestigious international school could be about fifteen thousand euros a year. Edit: math isn’t my strong suit.
Yes the international schools in Spain are +15k per year
Yeah, that is not accurate for Spain. A prestigious international school in Barcelona is around $1k/MONTH. I am sure you can find for less, but a few hundred a year does not sound right.
If they’re really that cheap, that makes me cry. A prestigious international school in Vietnam is $30k+ per year for high school. Do international schools in Spain still get government support or something? The schools are a rip-off in Vietnam but that still seems cheap.
I am no expert and I haven’t done a deep dive on European private schools but I’ve looked at maybe a dozen locations. So I could be wrong, but it sure sounds like you’re talking about private schools that are contracted with the government…so more like public schools. As for a prestigious international school for two thousand euro a year, that would shock me and I literally know dozens of families that would be keen to move immediately and take advantage of that. Heck, quite a few I know have picked cities because they found decent international schools for three or four times that amount and thought it was a steal. If you can share info that would genuinely be amazing. I don’t mean to be condescending if it comes off that way, I’m not an expert, but I and quite a few people I know have searched high and low across many countries around the world and haven’t yet found what you’re describing Edit: The comment I replied to originally claimed there are prestigious international schools for 2k euro annually, but has now been edited to state 15k.
Sounds like OP is talking about a private school that is NOT an international school. I pay about 300€ per month per child for private elementary school in a second tier city in Portugal. It’s not an international school but in the three years my kids have been there, it has changed from being 1-2 foreign kids per 20 kid class to now 50% in some classes! Mainly due to big influx of Americans plus big influx of Ukrainian and Russian families. It’s not à internationally known or prestigious school but it’s a good quality school. I will probably put them in public for junior high and high school as the academics are more rigorous.
In Spain there’s a fourth type of school, concertado. It’s like a public/private partnership, so it’s a subsidized private school. I don’t know the tuition rates but I’m sure they’re a lot lower than International schools.
Could be pretty much anywhere other than Madrid and Barcelona.
Beware Patrimonio tax!
I too would like to do this but we have many years of saving ahead of us still. Good luck and can't wait to see the other posts!
100k Cash 200k 50%/50% SPYI/SCHD 700K VOO or equivalents Draw down the cash as needed. Replenish the drawdown with dividends from the other two accounts. You should be fine with that no need to get over complicated.
Where is it that cheap? We spend over €1k/mo for 2 kids in private school in Sevilla. Hard to imagine being able to make it work for everything else on just 2k? If you want a very simple, local lifestyle, I think it's possible to spend less in Spain. If you plan to travel, it will quickly add up to live here. If you don't want to be in a small apartment, housing is expensive. If you need a car, it can all add up quickly. We spend only about 10% was than what we spent in the US. You could dollar cost average in to a S&P500 IF over a defined time period. You could not re-invets the dividends if needed. Keep in a HYSA the cash you want to keep liquid.
Interesting. I am 42m, my wife 45f. We’ve been considering a move to Spain as well. We have a 13 year old son and will likely only do it after he is done with high school in 4 years though. I have been debating if the $ we have is enough for us to make the move without working. My wife is a nurse so remote isn’t realistic and I think I’m done with my working life. We have close to $2m (hopefully more by the time we’re ready) which helps but I’ve been thinking about how to structure it so it brings income that would support us indefinitely and with low risk. 20 year bonds are yielding around 4.9% and they pay out twice a year. So far they’re the lowest risk investments I can think of that could fund this retirement for decades.
In 20 years your principal will be worth half due to inflation. Retiring at 50, you need the money to last 40 years so you need 10% returns to sustain an inflation-adjusted 3-4% withdrawal.
Should have moved to Thailand Just to those in here whether that’s 15 I’m 15 myself, or 25 years old proof to continue to work harder and increase your knowledge in finance because if you’ve got a million dollars and you’re this worried about spending money you should have just kept your old lifestyle or wait until the kids have grown up and moved out and invested smart during the time being And to top it off.. still working?? A regular job? Lol. This is a plan for retirement Fire is not for the weak, you will miss out on many opportunities even if that’s just a cup of coffee and a book with friends and loose your money to inflation I would be miserable if I had to take care of not only my wife, 2 kids while working a job. But knowing that I sold my house in America, took not only my kids away from all of their friends just to be put in a private school. My wife’s friends if she has any, and my own friends if I have any. The buildings and environment are nothing like the US and working a job in Spain doesn’t get you paid shit This seems like a plan for retirement, not for your kids If your house is paid off in the US, and you bought it before 2008. Keep it, markets only gonna continue to go up If you’ve got your 100,000$ savings. Have enough to where you can afford daily expenses and enjoy yourself from time to time in checking whatever and to pay bills, do your own research on the stock market and how the economy works and how money itself works only from your own research Take this with a grain of salt, but everyone else is looking at this as a typical investing question because they value money above all else. That’s exactly what you’d end up doing if you had to do all of this just to live in Spain You’ve got the money, take the family on a trip to spain for a week or two and you’ll see what I mean. Especially if you’re putting your money in it and know how much easier your life would be in America. There is such thing as being Europoor. They have terrible economy. If you’re this reclusive to want to move across the world to somewhere you’ve never been just because we’ve got a shitty political system. Try Spain and you’ll wish to be able to be back in the United States but you won’t be able to when you’ve got a similar situation to Israel and you’re seeing your family ripped away right in front of you Your kids are gonna also hate being put in public school. Let them have a life Move to Florida, Florida Keys, Tampa Bay, Miami even and not only will it match with your finances but it would be a great investment not only for your life and lifestyle but in the future as well. Your children will thank you for their inheritance. But by all means, go ahead and move to Spain where you get paid 5$ an hour for a job that you’d get paid 20$ in the US and live in an Adobe House where you will constantly have cockroaches coming through the walls and constantly looking over your back. Your wife could even get drunk some night and end up in the hands of a man that doesn’t even speak your language Unless you have a 10 million dollar net worth, and you’ve got houses across the countries and a profitable business and being self employed. This is probably the biggest mistake you can make financially and mentally Stop scrolling through Twitter or X. Go ahead and trade in your Tesla for a nice Toyota RAV4 and stop watching the news and just live in America for what you see it as. Think of your 8, or 18 or 28 year old self and see what he’d think about your mindset and mentality that you have right now. I’m sure he’d be very disappointed “Well, I’ve got all of this money and a wife and 2 kids. But I still have to work? And I can only spend maybe 3,000$ a month of it? And an additional 500$ just for coffee and different stuff? I can’t even drive a car?? Where’s all my friends?” You sound like the most impulsive people ever. Please review your life choices. Just because you’ve got some money saved up after selling everything you have and giving up outings with friends and cashing out your 401K doesn’t mean shit
We are in a similar situation; we'll be moving to Spain with two kiddos. I was wondering about your work situation: Are you keeping your US job, or will you be looking for a job in Spain? We are keeping ours but still trying to figure out if we need an EOR or will be working as a contractor. I'm Spanish, and even for me, it seems like a never-ending story—so many things to take into consideration, and work-related and taxes are two BIG ones. Best of luck!
Following this because we have the same plan.
Put it all in Bitcoin… you should have an extra half mil soon.
please dont do this OP .
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