Living the Triestine Dream: Let's quit work forever!!

This week I am obsessed with finances. Every once in a while I get this bug. I love reading the frugal blogs and trying to figure out how I can live free and clear without working (of course I will work anyway because I love working, but I just don't want all the PRESSURE to have to pay bills and things. I want them to pay themselves.)

Every time I bring this up, my husband has the same Italian reaction: "Retire early? That's not possible. We don't make enough money. We don't know anyone who has ever done that! Maybe in America, but no, sirree, not here in Italy! Not Possible!" End of Story.

But my Uncle?

Well, your Uncle made a lot more money than we do. He's rich. Maybe if we were rich... but we are not.

Well, how much do we have to have to be rich?!

Um. I don't know. A million?

And that's how these conversations go. Being able to "get there" is something that only "rich people" somewhere out in rich land can do. Not us. No. It is our destiny to work for an hourly wage that goes down every year (because we are in Italy) and accept our lot in life.

But I don't give up so easily. I pick up my journal again and again and again and I work out the numbers and try to work out how I can successfully replace my income with passive income (lower taxes and less work). Then I realized that I was coming at it from the wrong direction.

I realized I don't need to replace my income. I only need to cover my expenses. And my expenses are a completely different number than what I actually make on average because I do the one thing that ensures effective wealth building: I spend less than I make.

So I put together our fixed costs and came up with an insanely small amount that we actually spend per month then I added a good cushion to cover things like eating out (but once a month instead of once a week) and other "fun" spending. Once I did this, I started looking at what would be left over and how long it would take me to pay off my house, then buy another apartment for rental income (Italians are risk-averse, so property is an easier sell at my house).

Basically, the cheapskate blogs say it takes 7 years of living off of 30% of your income to retire (which does not mean "collect unemployment" it just means not have to work because your expenses are covered by passive income). When I did the math I found that I could pay off my house in 4 years (instead of 15) and then take another two and a half years to save up for another apartment to cover what is left of my expenses after my house gets paid off and including the small income I get from an apartment I already have. That means NOT SEVEN YEARS, but LESS!

Of course it means I would have to eat out less (which makes me hungry) but I think it would be worth it.

Then I realized that the money I get back each year from doing home improvements on my house over the next ten years gives us exactly the same amount of money that a rental would.

Incredible.

You just have to do the numbers. And live on the ultra cheap. More information on what that actually means as well.

Doing Work on Your House Pays You Back

If you happen to be doing work on your house, you can get a lot of money back if you do the correct paperwork. This is part of a government plan to cut down on tax evasion. Basically, the government is encouraging you to work with companies and individuals that invoice their work (much to the chagrin of workers and artisans who have been working in a cash-only economy since the beginning of time). They do this by refunding you 50-65% of what you paid to do work and/or make your house more energy efficient and/or furnish your home, over a ten-.year period.

Over the last year, we redid the plumbing and heating system on our house (65% back), got new doors and windows (65% back), knocked down a wall and two doors (0% spent, hubby did it himself), put in new flooring (50% back for materials and labor), redid the kitchen (50% back) and two bathrooms (50% back on materials and labor) and furnished the rest of the house (50% back and this includes things you buy at IKEA!).

For us this comes to roughly 4000 euros back each summer for the next ten years. Just to put it into perspective, if we add this money back to our 15-year mortgage, we can pay off our house five years sooner. We would have done this work anyway but we get this added extra bonus.

If you live in Italy, do your homework before you do work on your house. The paperwork can be tricky but it is definitely worth it!

We love Trieste on the Cheap!!

Did you lose a duck this weekend?

If you did, let me know. When this little sweetie showed up in my driveway yesterday we let him rest for a bit and then called ENPA to see what to do. A couple of hours later they came and took him and told us to spread the word because he is a domestic duck and is someone's pet. He had eaten yesterday (proof of that was in my driveway until we cleaned it up) so he probably wasn't far from home. I asked if we should keep him until we could find the owner but they said the danger is that he would take flight again and end up in the street as these types don't fly too far and he could be in danger if he did.

So, if you know anyone who is looking for a duck in the San Giuseppe area, please called ENPA or get in touch with me.

Quack.

UPDATE ON THE DUCK: Last we heard (last Tuesday), no one had claimed the duck and two more were found!! One was not far from where we found the duck in the picture, and another was in the middle of Via Flavia. Poor duckies!! Now they are in the safe and loving care of ENPA, but keep your feelers out for anyone who could be missing their pets.