Making Six Figures While Living Abroad (NO W2!) to FI Even Faster

Summary

BiggerPockets Money Podcast Summary

Episode: Making Six Figures While Living Abroad (NO W2!) to FI Even Faster
Release Date: November 19, 2024
Host: Mindy Jensen and Scott Trench
Guest: Brooklyn Nash

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Introduction and Guest Background

In this engaging episode, hosts Mindy Jensen and Scott Trench welcome Brooklyn Nash, a successful entrepreneur from BiggerPockets.com, who shares his remarkable journey from financial instability to achieving significant income while living abroad. Brooklyn's story is a testament to breaking generational financial cycles through strategic moves like geo arbitrage and building a profitable writing business.

Mindy Jensen [00:00]:
“We are very excited to have Brooklyn Nash on the show with us today...”

Overcoming a Risky Financial Upbringing

Brooklyn opens up about his family's tumultuous relationship with money, marked by risky financial decisions and a mix of frugality and unsuccessful investments. Growing up amidst pyramid schemes and inconsistent financial advice, Brooklyn witnessed his parents’ struggles, leading to numerous cycles of financial upheaval.

Brooklyn Nash [01:19]:
“There were a lot of pyramid schemes... and on the bigger investments, they didn't... stay the program. So it just turned into 20 years of financial upheaval every few years.”

This background instilled in Brooklyn the importance of financial independence, teaching him to balance earning more with saving effectively—a lesson he contrasts sharply with his parents' approach.

Breaking Free: From College Debt to Financial Independence

Brooklyn and his wife navigated significant student debt after attending a private university in Southern California. Despite accumulating $80,000 in student loans, they focused intensely on debt repayment, adhering to a strict debt-aversion strategy inspired by Dave Ramsey's principles.

Brooklyn Nash [04:35]:
“We paid it off in about five years when really looking back we could have taken a more balanced approach and maybe should have been investing a third of that.”

Post-debt liberation in early 2018, Brooklyn and his wife shifted their focus toward increasing their income rather than solely minimizing expenses, embracing an abundance mindset to fuel their financial growth.

The Move Abroad: Leveraging Geo Arbitrage

Seeking a lower cost of living, Brooklyn and his family relocated to Guatemala after spending a year in Israel for his master's program. This move was pivotal, allowing them to live comfortably on $10,000 to $12,000 annually, significantly accelerating their path to financial independence.

Brooklyn Nash [14:18]:
“We were able to live off of $10 to $12,000 a year, which helped us achieve our goal.”

Living in a low-cost environment like Guatemala enabled them to aggressively pay off debt and invest in their burgeoning freelance business, setting a foundation for substantial financial growth.

Building a Freelance Empire

Transitioning from nonprofit work to full-time freelancing in writing and marketing, Brooklyn and his wife rapidly scaled their income. Starting with a goal of $40,000 in their first year, they surpassed expectations by earning $65,000 and eventually reaching a combined income of $300,000 through their freelance endeavors.

Brooklyn Nash [15:47]:
“By year one, our goal was $40,000... we hit more like $65,000 by the time we launched the agency... a solid six figures for each of us.”

Their success in freelancing laid the groundwork for establishing BeamContent Co., an agency that separates their time from income by building a scalable business model.

Transition to an Agency Model

Recognizing the limitations of freelance work, Brooklyn and his wife transformed their business into an agency about two and a half years ago. This strategic pivot allowed them to scale beyond their individual capacities by hiring a full-time team and numerous contractors.

Brooklyn Nash [18:21]:
“We have a full-time team of five and about 20 contractors that we work with around the U.S...”

This shift not only increased their income potential but also provided the flexibility to focus on strategic growth rather than day-to-day client management.

Achieving Geographic Arbitrage and Financial Goals

Brooklyn emphasizes the power of geographic arbitrage—earning a high income while living in a low-cost country. By operating BeamContent Co. from Guatemala, they maximize their earnings potential and stretch their income further than it would in higher-cost places like San Diego.

Brooklyn Nash [21:10]:
“That $60 to $80,000 goes a lot further here than it would in San Diego, where we're from.”

While Brooklyn acknowledges that they are not yet financially independent, they describe their current status as "Coast FI," where their investments grow without the need for additional contributions, allowing them to focus on reducing work hours for better work-life balance.

Navigating Taxes and Legalities

Operating a U.S.-registered business while residing in Guatemala offers significant tax advantages. Brooklyn leverages the Foreign Earned Income Exclusion, allowing them to exclude a substantial portion of their income from U.S. federal taxes. Additionally, their income is not subject to Guatemalan income tax due to its source being a U.S. entity.

Brooklyn Nash [32:58]:
“We don't pay federal tax on up to... it's in the six figures of income that you earn while physically out of the United States.”

This strategic tax planning ensures they retain a larger portion of their earnings, further accelerating their financial growth.

Balancing Business and Family Life

With two daughters born in Guatemala and a stable community, Brooklyn and his wife plan to remain in the country for the next decade. Their financial strategy prioritizes family time and personal goals over traditional financial independence milestones.

Brooklyn Nash [22:26]:
“Both our daughters were born here... we're here at least the next decade as they move through high school and into what comes next for them.”

Their current goal is to reduce work hours from 30-40 per week to 20-30 hours, allowing more time for family activities without fully retiring from their business endeavors.

Advice for Aspiring Geo-Arbitrage Entrepreneurs

Brooklyn advises thorough research before relocating, emphasizing the importance of understanding a country’s visa requirements and the feasibility of earning income remotely. He highlights Guatemala's compatibility with their business model due to favorable time zones and the ability to easily manage U.S.-based clients.

Brooklyn Nash [40:42]:
“It really depends on the country... you have to plan for that and that's an additional expense.”

He encourages aspiring entrepreneurs to experiment with short-term stays abroad to assess their comfort and the financial impact before committing long-term.

Conclusion and Future Plans

Brooklyn and his wife have successfully harnessed the benefits of living abroad while running a high-earning business. Their approach combines disciplined debt repayment, strategic income growth, and geographic arbitrage to build a sustainable and flexible financial future. As they continue to expand their agency, their focus remains on achieving a harmonious balance between work and family life.

Scott Trench [43:06]:
“This was a lot of fun. I enjoyed meeting you in real life...”

Their journey serves as an inspiring model for anyone looking to achieve financial independence through unconventional paths, demonstrating that with the right strategies, it’s possible to thrive financially while embracing a global lifestyle.

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Notable Quotes:

• Brooklyn Nash [01:19]:
  “There were a lot of pyramid schemes... and on the bigger investments, they didn't... stay the program. So it just turned into 20 years of financial upheaval every few years.”

• Brooklyn Nash [06:51]:
  “Freelance income has been really great for us... it can be not a riskier option than full-time employment.”

• Brooklyn Nash [21:10]:
  “That $60 to $80,000 goes a lot further here than it would in San Diego, where we're from.”

• Brooklyn Nash [22:26]:
  “Both our daughters were born here... we're here at least the next decade as they move through high school and into what comes next for them.”

• Brooklyn Nash [31:56]:
  “The foreign earned income exclusion... it’s getting higher and higher every year... you have to be out of the United States for 330 days out of a 365 day calendar.”

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Connect with Brooklyn Nash:

• LinkedIn: Brooklyn Nash
• Company: BeamContent Co.

For more insights on achieving financial independence through creative strategies, subscribe to the BiggerPockets Money Podcast and join Mindy and Scott each week as they explore pathways to grow wealth, save more, and spend smarter.

Transcript

[Mindy Jensen]

We are very excited to have Brooklyn Nash on the show with us today. Brooklyn grew up in a household with unstable finances, but he was able to break this generational cycle with a few creative moves, namely geo arbitrage and starting a small but very profitable writing business. These are going to set him and his kids up for a very different financial future. With your current circumstances, you may be a long way from fire, but what if relocating was the only thing that it took for you to reach your financial independence number? And should you do it? Hello, hello, hello, and welcome to the BiggerPockets Money Podcast. My name is Mindy Jensen, and with me, as always, is my. Not arbitraging his geolocation quite yet. Co host Scott Trench.

[Scott Trench]

Thanks, Mindy. Good to see you. Never get tired of trading out new introductions for me.

[Brooklyn Nash]

All right.

[Scott Trench]

Biggerpockets has a goal of creating 1 million millionaires. You're in the right place if you want to get your financial house in order, because we truly believe financial freedom is attainable for everyone, no matter when or where you're starting.

[Mindy Jensen]

Brooklyn Nash, welcome to the BiggerPockets Money Podcast. I am so excited to talk to you today.

[Brooklyn Nash]

Me too. Thanks, Mindy.

[Mindy Jensen]

So, Brooklyn, let's jump right into it. We understand that your family had a sort of unstable or risky relationship with money growing up. Can you share a little bit about what that looked like it was?

[Brooklyn Nash]

Risky is the word. All the financial advice that has become so prevalent over the last decade with Ramit Sethi and even, I don't know, all the fundamentals weren't there necessarily. So I do give them a little bit benefit of the doubt. But there were a lot of pyramid schemes. There were a lot of get rich quick schemes. They were Y2K preppers. We had pampered Chef in the House, like those shows, Excel phone lines. They did the essential oil thing, the pyramid scheme, like, anything to make a buck. And then on the flip side, they're also very, very frugal. So they were good at being frugal with their money. But then on the bigger investments, on the flip side of that equation, they weren't. They didn't, like, stay the program. So it just turned into 20 years of financial upheaval every few years.

[Scott Trench]

So can you give us a couple of examples? Like. Like, are you saying basically that your parents would accumulate, they would try these get rich quick screams, they would blow up in their face, and despite their frugality, they would lose everything or there would be a bankruptcy or there would be a forced lifestyle reduction? Is that How I understand that, yeah.

[Brooklyn Nash]

There are the big ones and the small ones. Pyramid schemes I don't think ever took a huge toll. But my dad would do the risky betting on Wall street, like Wall street bet type stuff, penny stocks. When I don't pretend to understand that, I just stick it in an index fund. So there's a lot of cycles of losing money that way. And then similarly for housing decisions and just kind of buying more than we could afford. Um, and those were the bigger, the bigger impact stuff.

[Mindy Jensen]

So what lessons did you learn from watching your parents go through this? Because I, after, you know, 500 plus episodes of this show, I find that people either are exactly like their parents or the polar opposite of their parents based on what their parents were doing, either right or wrong.

[Brooklyn Nash]

I think the biggest thing that I had to untangle was this. These two parts of the equation where you can. It's to reach financial independence, you can focus on earning more or saving more with what you're earning. And my parents really overemphasized that second part and underemphasized the first part. It took a while for me to untangle that. The first fight that my wife and I both remember was over this. She, we were out, needed to get clothes at a mall and we were coming back. She was hungry, wanted food at the food court. I grew up really frugal. Going out wasn't a thing. I'm like, well, can we go home or half an hour from home and make lunch? And it turned into a big fight because we had very different upbringings and expectations. And I'm not. It wasn't the next day. It was probably over a year or two. Slowly realizing that frugality can only take you so far and there's a lot you can do, especially now, to increase your income. So we started focusing after our first and second year of marriage away from let's spend as little as possible and deny ourselves all these things. And instead let's turn our attention towards an abundance mindset and seeing what we can do income wise and what that can mean for our family and for giving and for everything we wanted to do together.

[Scott Trench]

Could you maybe give us a little bit of the synopsis of the story here? You know, how did your money journey go? I think we know that you met your wife in college. Can you give us how your personal financial story went in college? Following college and in the next last.

[Brooklyn Nash]

Couple of years, my wife and I both went to a private university in Southern California. Probably not a great start financial wise, but thankfully we Both got really solid financial aid for the four years. The debt that we did accumulate was more. It was housing and all these other factors which add up when you don't have parents that can help out with college. We're very grateful for the financial aid, but graduated between the both of us with 80,000 in student debt. So our first year of marriage was okay. This is. Debt is an emergency. Let's treat this as emergency. Back then it was Dave Ramsey stuff because we were at that level. So we just focused on paying off the student debt first. We did very little investing, very little savings for I think two years. We had the bare minimum like thousand dollar emergency fund just because we wanted to throw as much as possible at the student loans. I don't mean to give as advice because we very much over. We're very debt averse, so we very much overemphasize. Let's get this thing paid off as quickly as possible. So we paid it off in about five years when really looking back we could have taken a more balanced approach and maybe should have been investing a third of that. And over 10 years it probably would have served us better. But it did feel really good about five years in to just have it completely wiped and start with a net worth of zero.

[Mindy Jensen]

And what year Was this?

[Brooklyn Nash]

Late 2017 or early 2018.

[Mindy Jensen]

Okay, and where were you working? Were you self employed or were you working for another company?

[Brooklyn Nash]

It was a bit of both. So we moved right out of college. We moved to Israel for my master's program and then we moved to Guatemala for a non to work with a nonprofit. Nonprofit didn't pay anything. We were essentially volunteers out of college, you know, bright eyed and purpose driven and all of that. And we were freelancing on the side to start paying off the student debt and savings and all of that. So for a while it was a whole mix of income. And those first five years was essentially all freelance income.

[Mindy Jensen]

Freelance income. And you had $1,000 safety net. I'm not familiar with the economic conditions in Israel. Is that more of a high cost of living or a low cost of living area?

[Brooklyn Nash]

Super high cost of living. Tel Av. Super expensive.

[Mindy Jensen]

Yeah, that's what I thought. All freelance income, thousand dollar safety net in a high cost of living area. Don't do that listener.

[Brooklyn Nash]

Well, that was one year out of five. So it balanced out because then we moved to Guatemala which is super low cost of living. Right.

[Mindy Jensen]

So that was where for a year you had. That's a lot of risk. Did you feel like it was risky or did you feel like, you know what, I'm, I'm okay with this because I want to get this debt gone so fast?

[Brooklyn Nash]

I don't think it felt risky to us at the time. Although you're right, Hindsight, same thing. We should have at least saved up a bigger emergency fund with some of what we were using to pay off the loans. But it didn't feel risky at the time. And I know this isn't what this podcast is about, but in general, I don't think freelance income is as risky as most people think it is. Like, if you're a freelancer and you have six clients, what are the chances that in a matter of three months, all six of those clients are going to churn compared to there's a downTurn, you have one employer, what are the chances that that large employer that has very little Runway is not going to go through a layoff and that you won't be impacted by a single event? So it sounded a little bit like I got on my soapbox, but like freelance income has been really great for us in terms of just sure, there's a ceiling, but there's a, I think a much higher ceiling. You can use your time and your skills and as you build up your client base, I think it's can be not a riskier option than full time employment.

[Scott Trench]

All right, now a quick ad break. When we're back, Brooklyn will tell us how he was able to break out of bad financial circumstances and make his own path.

[Brooklyn Nash]

This show is sponsored by Airbnb.

[Scott Trench]

Back when I lost my job in 2020, Airbnb is what gave me the extra income to work for myself.

[Brooklyn Nash]

Look, I wasn't a big real estate investor then.

[Scott Trench]

I was just trying to take care of my family. And thanks to Airbnb, I've done so much more. Next time you're out traveling for work.

[Brooklyn Nash]

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[Scott Trench]

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[Brooklyn Nash]

With Airbnb, your home might be worth.

[Scott Trench]

More than you think. Find out how [e-mail] host I love.

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[Mindy Jensen]

Welcome back to the show. Okay, that's actually really good to know because I don't have freelance experience, so I've just always assumed that it's kind of risky. But that makes a. That's a really good point. Like if you have six sources of income and one goes away, now you have five sources of income. If you have one source of income and one goes away, now you have zero sources of income. So that, that does make sense. I like the way that you look at that.

[Brooklyn Nash]

Especially if you're already financially minded and you are saving what, 30, 40, 50% of your income. You could lose half your clients and still cover your expenses without touching your emergency fund.

[Scott Trench]

Yeah, it's also hard to pick up a second client when you work a full time job, probably really shouldn't. And on the freelance side, it's probably not too hard to pick up a seventh or eighth client there to 10 or 20, 30% increase your income. So I think the freelancing world. I think that's right. I also want to talk about. There's a side tangent I'll just mention really briefly here where people talk about unemployment in this country. Well, something's brewing in this freelance and gig economy because I think there was something some 40 odd million Americans who participated in the gig economy last year and that was up like 300% from before the Great Recession, for example. And so what happens when a freelance, like surely a lot of those folks found fewer clients, harder to get rides for Uber drivers or whatever in there that doesn't show up on the official unemployment statistics. Right. Because those people don't go on unemployment. They're not losing their job, they're just getting less income. So Something's brewing there that I don't think people have good data on. And I think that that's impacting the economy in ways that are not fully appreciated yet. And we'll shake out over couple years. But just a. Just something I have observed and thought about a lot recently on this. So let's bring it back to your story, however. So we have our freelancing in Israel. We're doing that. We pay off the student loans in five years. When does the journey become less about paying off the student loans and more about financial independence?

[Brooklyn Nash]

Pretty early, actually. So even I think year two, we discovered financial independence through the subreddit that was the origination. And then from there, Mr. Money Mustache and Ramit Sethi and Biggerpockets and just really dove into everything like 2014, 2015, and paying off student loans was for us, that first step. We didn't do the more balanced approach that is probably a lot smarter and that you all recommend and much smarter people than us recommend. But to us, the debt represented a fresh start. So from year two, paying off that debt became the first goal. And then once we paid it off, then we're like, okay, what is the next goal? That's increase our income to XYZ and hit 100,000 in investments. And then we started hard charging towards that.

[Mindy Jensen]

And how long did that take you to get to a hundred thousand in investments?

[Brooklyn Nash]

Within a couple of years. Because around that time is about when we stopped working with a nonprofit, started working full time in marketing and writing work. So we pretty dramatically increased our income around that time.

[Scott Trench]

Awesome. So let's walk through that part of the journey. So how long were you in Israel and when did your situation begin to change? I believe Sneak Peek is still international to this day. But can you walk us through the journey and the steps?

[Brooklyn Nash]

Yeah. So we were only in Israel for a year for my master's program, and then we moved to Guatemala, which that's the biggest context here, because this wouldn't literally wouldn't have been possible if we were living in the United States, because for a few years there, we were able to live off of 10 to $12,000 a year, which helped us achieve our goal. So the four years, four of the five years were here, Guatemala, paying off student debt, working with the nonprofit, and then the last five years have been out of the nonprofit, really focused on what can we do to maximize our income and meet our next goals. So. And we're still, we're still here in Guatemala.

[Scott Trench]

Okay, so you guys are earning. You guys are can you, can you give us a little bit of kind of some guidance on are you able to earn like six figure salaries doing this from Guatemala? How does, how does, how does this career growth happen from international perspective to provide opportunities that you wouldn't have had access to otherwise? Or how did you get into this and decide to go to Guatemala, stay in Guatemala and build your career from there?

[Brooklyn Nash]

Yeah, it was a very indirect path. So we came to Guatemala not for any career moves or the money sense. It was just to work with a nonprofit. We both graduated with sociology degrees and international development and social work and really wanted to dive into that world. Um, we kind of discovered financial independence along the way and it worked out that we were working in low cost of living and then it was just a matter of putting the puzzle pieces together.

[Scott Trench]

Yeah, I would love to get the next piece there. Like, tell, tell us about how the career developed. Like, like I, you know, how did you, how did you get a job, you know, in marketing that pays enough to sustain financial independence from Guatemala? Is that like, like, is this another repeatable path for folks like, like, can you maybe, maybe we'll take a quick edit and that would be really helpful. Think about this from the perspective of someone listening who's like, I'm starting my career and I'm thinking about doing something similar. What are the takeaways that I can get from Brooklyn and think about in terms of opportunities for me if I want to live internationally or build a career in another country.

[Brooklyn Nash]

So year one, about five years ago of going full time into freelance writing and marketing, my goal was to make $40,000 in that calendar year. I think that first year we hit like 65,000 and then it grew from there. So I do think it's repeatable now. A and B, it was just a matter of discovery. So yeah, getting a full time job, especially a remote job at that time probably would have been close to impossible. Freelance opportunities were abundant. I started on upwork and then grew out from there once we started building our network and just kind of slowly started realizing which types of work A were more interesting and sustainable for us and B, which gigs paid more. So over a couple of years we honed in on B2B tech as our main client base. So narrowing in on that part of the freelance world really helped increase our income and solidify our network. From there. I also took a full time job for two years while we maintained our freelance business. This whole time it was my wife and I working together on it. Those two years were game changing in A couple of different ways. Number one, financially, the full time income and the freelance income really just kind of skyrocketed. What we were able to do, I don't recommend it for more than the course of a couple of years, but it was the first two years of COVID we weren't do, couldn't do anything anyway. So it was just two years of like 60 to 80 hour weeks to kind of jumpstart what we were trying to do. Then once we, once our freelance income outpaced my full time income, we decided to jump back out of full time and go all in on the business. So we around that time turned the freelance business into an agency. So some numbers, Scott. We year one goal was 40,000 in the first year. We hit more like 65,000 by the time we launched the agency, just the freelance income between my wife and I was around 300,000. Split it right down the middle, it's a solid six figure for each of us. But that was about the limit of what we could do ourselves, which is why we turned to an agency model to keep learning and growing and seeing what we could do.

[Scott Trench]

Awesome. So tell us about that. So you turned in jobs, money for time and now you just use the word agency. Can you tell us about this? Is this a business that you've, you've now built and when did that start and how's that going?

[Brooklyn Nash]

So far so good. We started it, launched it about two and a half years ago and yeah, it's, it's kind of flipped. The switch is less trading our own time for money and more. Okay, we've got something unique here that there is a demand for. How can we build a team around it so that this thing can be a machine of its own and run without us down the line? That doesn't mean necessarily selling and it doesn't necessarily mean completely stepping back, but it gives us an if we look at it as an asset that we can use how we want. So yeah, the last two and a half years have been about building the business. We have a full time team of five and about 20 contractors that we work with around the U.S. okay, so.

[Mindy Jensen]

You are creating jobs and then you make money off of when they do work, you bill them out at X and you pay them Y and then the same with the contractors. So you're making money. I, I, I'm not phrasing it right, but you like you are connecting these people who are doing a job with people who need a job. And that's, that's your agency now.

[Brooklyn Nash]

A Little bit like that. Yeah, I mean, yeah, you're putting the financial model baldly, but that's essentially it as a type of arbitrage, but it's less of a marketplace or, or recruitment of just connecting people and more we have our full time team focused on strategy for clients. So it's very much long term partnership. Like some of our clients we've been working with the whole, even before we launched the agency on a freelance basis and then they transitioned in with us. So it's this long term relationship on one side with the client and then on the freelancer side. We were both freelancers for almost 10 years, eight years before we launched. And so we want to provide a really good experience for freelancers. So yeah, we do. We charge one thing to clients and we're able to pay out to our contractors another. But the idea is that in the middle we're taking off their plate all the time sucking stuff like client communication and handholding, the strategy work, the briefs. And we're just letting our writers be writers and our designers be designers.

[Mindy Jensen]

And you're running this for American clients but from Guatemala?

[Brooklyn Nash]

That's right, yeah. So all over the U.S. some in Europe, but yeah, mostly U.S. based.

[Mindy Jensen]

So this geographic arbitrage that you have been able to take huge advantage of is the difference between a, you know, ten plus year fi journey and like, do you consider yourself financially independent right now?

[Brooklyn Nash]

No, no, not yet.

[Mindy Jensen]

But it's the difference between, you know, this, this much longer because America has a higher cost of living than Guatemala does. I mean you were living on 10 or $12,000 a year in Guate, Guatemala. That doesn't really get to a lavish lifestyle in the United States.

[Brooklyn Nash]

Yeah, that it's been the biggest difference honestly the last 10 years. I mean now that was a few years in a row before kids, we were able to live off of that. Now we're a lot closer and even a little bit above I think, average American household income. But we've also been able to increase our income at the same time. And that 60 to $80,000 goes a lot further here than it, than it would in San Diego, where we're from.

[Scott Trench]

Let's set a couple of facts out here. Where, where in Guatemala do you live?

[Brooklyn Nash]

We are just outside Antigua, Guatemala, which is just outside the capital city. It's the main expat spot. The first half, the first five years we were way up in a mountain town called Way to Nango, which has a, even within Guatemala has a much lower cost of living. It's like Living in a Kansas City versus a la.

[Scott Trench]

Okay, awesome. And do you plan to live in Guatemala for many more years? Is this your home now? For the foreseeable future, it is, yeah.

[Brooklyn Nash]

Both our daughters were born here. We bought a house here. So we're here at least the next decade as they move through high school and into what comes next for them.

[Scott Trench]

And then, you know, could you give us an idea of how close you are to financial independence and what that target looks like for you?

[Brooklyn Nash]

Our goal has definitely shifted. Like I said, when we started, it was the yearly income was 40,000. Our FI goal was like 800,000. Something like very much the lean fi side of things. And then as we, you know, grew up and realized things and had kids, and we're like, okay, that's not realistic. Let's go back to the drawing board. So we don't actually have a hard phi number, to be honest. We've kind of shifted our thinking. So I'm saying we. But that's just because my wife and I talk about this a lot. So I feel grateful that we're very much on the same page. But now for us, it's much less about, okay, we're gonna hit 1.8 million by 36 so that we can never work again. And it's much more about, okay, we like work. We like this creative stuff. We like working with people. We don't want to do it for 40 or 50 hours a week, and we don't want to do it for 30 or 40 years, but we like it. So what can we do now to reduce the time that we're spending working but not eliminate it altogether? So right now is more about adjusting our schedules, adjusting the level of involvement in the business so that we can be not phi and not retired early, but be able to work 20 or 30 hours a week and be able to do school activities. So right now it's much more about adjusting to what our current goals are rather than our goals for a decade from now.

[Mindy Jensen]

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[Mindy Jensen]

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[Brooklyn Nash]

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[Scott Trench]

Lender Member FDIC let's jump back in.

[Mindy Jensen]

Okay, so you like what you're doing, but you don't want to do it 40, 50 hours a week for 20 or 30 years? I totally understand that. Have you sat down and, like, made a list of the things that you want to do or what's the process for figuring out your balance between how much you want to be working versus how much you want to be making?

[Brooklyn Nash]

A lot of conversations and trial and error. I think those two years of working 60 hours really showed me, a, I don't want to do this forever, and B, okay, let's walk this back. And instead of we hit over those two years, I think that's when we broke 350 or around 400,000. And so we laid that really solid foundation. We're coast FI essentially right now. Rather than fi. Going back to your question, Scott, like, if we were to not put another penny in savings, we would be beyond our FI number in quotes at 55. So we're like, okay, Coast Phi is taken care of. Now what do we want to do? So, Mindy, it's more talking through, okay, we have it taken care of. All we have to really worry about is our current expenses, which we have covered, and then just keep talking about what the next three to ten years look like. So over the next few years, we both envision ourselves staying involved in the business. We don't want to step back completely. So we're good taking our salary, working in the business 30 to 40 hours a week. And then over the next couple of years, the next goal for both of us is how do we get down from 30 to 40 hours to maybe 20 to 30 hours.

[Mindy Jensen]

And is that your goal, 20 to 30 hours a week, or is that just the current goal and then you'll step. Because, I mean, I think it's really valid. There's this, this idea that, you know, oh, I'm going to reach financial independence, I'm going to retire early and I'm never going to do anything again. And I live in Longmont, Colorado. I hear from a lot of people, I have a huge community around me of people who have reached financial independence and they've quit their day job, but they don't stop working. And the reason that they quit their day job is, you know, kind of the reason that they started pursuing financial independence in the first place. They weren't happy there. But it sounds like you are happy where you're at. You, you've like created this job that you love. So stepping away from it is, I don't want to say silly or foolish because if you don't want to work anymore, then that's like, that's what you want to do. But you know, when you've got this. What is that stupid phrase? If you love what you do, you'll never work a day in your life. Like it's, it's also kind of true though. It's, it's silly, but it's true. I mean, I'm, I'm a real estate agent and I get to talk about money and real estate on a podcast. Why would I not work?

[Brooklyn Nash]

Yeah, we feel very lucky in that because we had that realization of, okay, most of the people in these forums and on the subreddit and you have full time jobs and there's not a lot of flexibility. We were able, because we were self employed to navigate to something that we find interesting and creative and we get to do fresh things with our clients over the last few years. So that's, that's helped a ton. That said, I have higher priorities in my life. I want to go to my daughter's dance recitals, I want to pick them up from school, I want to go camping, I want to take surfing lessons with them. I want to be able to take any time they're off of school, I want to be off of work. Those are my priorities, even if I find work interesting. So yeah, going back to your question right now, the goal is to reduce to about 20 to 30 hours by the time we hit in June will be the three year anniversary of our launch. So that's current goal is very much more time based than it is income based.

[Scott Trench]

I love the framing of that goal of anytime they're off school, I want to be off work. That's like an awesome in between state for financial independence and full time work that I think will resonate with a lot of people. I want to ask a couple of mechanical questions here that relate to you investing and building wealth and building a business out of the United States. Is there particularly special things about Guatemala that make this easier, attractive or do you think that. Yeah, I guess that's what I want to parse out here. Can you tell us how easy is it for an expat to start a business in and found it and incorporated in a place like Guatemala?

[Brooklyn Nash]

Yeah, I should have Becca in here because she's my wife. She's our head of operations and knows the mechanics much better than I do. But in short, Guatemala doesn't have any special advantages financially. What the biggest advantage is, no matter what you do, whether you're full time or self employed, is the foreign earned income exclusion. So up to. I forget what it is this year, but it's getting higher and higher every year. Just like 401ks and tax credits. It's in the six figures of income that you earn while physically out of the United States. I'm not a cpa, so check this. And there's exceptions and there's a lot of rules but is not taxed at the federal level. So beyond just the cost of living savings, we've paid a lot less tax than if we had been living in the United States. The only requirement there is that you're out of the United States for 330 days out of a 365 day calendar.

[Scott Trench]

Do you pay income tax to the US government on anything come earned in the United States?

[Brooklyn Nash]

That's what I mean. The federal earned income exclusion is we don't pay federal tax on up to it. What when we started it was like 120something thousand and it just has gone up from there.

[Scott Trench]

Okay, got it.

[Brooklyn Nash]

Sorry.

[Scott Trench]

That's for the U.S. government. And then how about for Guatemala, how do the taxes work there?

[Brooklyn Nash]

Certain taxes for being residents and owning property. There's some property tax but there's no because our income isn't from a Guatemalan company, we don't pay income tax either. So tax burden here has been I think a couple grand a year.

[Scott Trench]

Awesome. Okay. And do you have to be a citizen in order to incorporate a business that is headquartered in Guatemala or how does that work?

[Brooklyn Nash]

Getting in the mechanics. We're actually a US business so we don't have a Guatemalan presence. So Even though our business is registered in the U.S. we live physically outside of the U.S. so we're able to a attract U.S. clients because we're a U.S. business and paperwork and connecting payments and all that is seamless. But we're also able to claim the foreign Earned income exclusion because we're physically out of the US for 11 out of 12 months.

[Scott Trench]

This is super fascinating and stuff I don't know anything about. You know, I'd be interested to hear commenters perspectives on the intricacies of this and Brooklyn. I suspect that as your business grows, some of these things that you're saying will not actually be able to scale into larger revenue items. Like for example, California ain't going to let you get away with that for very long once you get past a couple hundred thousand in revenue from that state.

[Brooklyn Nash]

That's the sticking point. California, we don't at all. We've paid very little in federal tax and I don't even know how much in California tax the last 10 years, even though we haven't been in California for 10 years.

[Scott Trench]

Let's talk about. So. So you're not a citizen of Guatemala. You are a US citizen living in Guatemala for many years.

[Brooklyn Nash]

That's right. We have residency here, which just means we don't have to leave every three months, every 90 days. We can stay put. Both our daughters were born here, but yeah, we're not citizens, we're US Citizens. Daughters are Guatemalan and US citizens, which is a whole other can of worms for down the line.

[Scott Trench]

What do you do for benefits and those types of things? Health insurance, all like, all those goodies.

[Brooklyn Nash]

We have an administrator in the US that provides benefits for our employees. We technically could take advantage of that if we were in the US but because we're not, we just pay out of pocket for international global health with cigna. It's a, what's it called? High deductible. There's an acronym for it, but it's a high deductible one and that's worked well. We just pay out of pocket because a doctor's visit and dentists are so low here, it doesn't make sense for us to pay premium when we could just pay out of pocket.

[Scott Trench]

How about the mechanics of investing? What do you invest in? And I've heard that some folks have no issue investing in things like an index fund, a stock, US Stock market index fund internationally. And some folks have to go to great lengths to get creative to try to replicate that because it's not offered to their countries. Can you Tell us about your experience with that.

[Brooklyn Nash]

Yeah, because we're from the U.S. we're able to participate in the stock market. So we have. Bogleheads will be happy. Like we have a Vanguard account, we're in VT Sachs and Bond, whatever, BBLTX and that's about it. So yeah, across our 401k and our brokerage, it's pretty much just index funds with the 9010 split. Very boring.

[Scott Trench]

Now you open up a whole other can of worms here. If you don't pay any federal income tax and you don't pay any tax in Guatemala, what is the advantage of contributing to a 401k?

[Brooklyn Nash]

It's only up to a certain amount. So we're earning for married filed jointly, we're earning well above what the limit is. So contributing to a 401 reduces what we're paying off on top of the exclusion.

[Scott Trench]

Okay, so you do contribute to US national debt reduction on an ongoing basis.

[Brooklyn Nash]

Yeah, we're not. I sound like such a jerk over here. Yeah, I haven't paid taxes. Well look, you live internationally, you don't.

[Scott Trench]

Partake from the system, contribute into it.

[Brooklyn Nash]

Thank you.

[Scott Trench]

Yeah, that's, that's wonderful of you.

[Brooklyn Nash]

Yeah, we think of as fair because we don't live there. So we pay whatever's above. But 11 and a half months out of the year we're not there. So that's where we're at. But yeah, we do pay into the Fed, into federal taxes and FIKA is still a thing, especially as a business. But yeah, federal income, the exclusion has been a big chunk because that's more than half of what our current W2 salary is.

[Mindy Jensen]

Okay, so Brooklyn, this geographic arbitrage angle that you have invented, haha, sounds like a really amazing way to game this system. So you're making high income, you're living in a low cost of living area and you still have citizenship in America. So should something happen in whatever country you're living in and you could move back, how did you decide to take this, this jump? Like was it, was it hard to say goodbye to your family and like leave all your friends and you can, with the Internet you can talk to anybody and you can Send gifts with FedEx and it gets there in like a day and a half. But is it hard to walk away?

[Brooklyn Nash]

It wasn't 11 years ago, but. So this is probably a moot point. But at 21, we were like, yeah, worlds are oyster, let's get out there. And sure. Our parents were like, what are you doing? We're like, yeah, we're doing it. So we, the same reason we just went whole hog on paying off student debt. We just didn't know what we were doing. We were just jumping into things. So it was hard the first few years. But then once we realized, like we started Guatemala started to grow on us and we realized the financial impact and we started growing these financial goals, you know, we stayed put. Then the middle part was a little hard. And then now the last few years with our girls growing up in a solid school and a community here, this is just home. Like we can't imagine leaving it now. Yeah. So I don't know how relevant that is for, you know, a 36 year old who's looking at making a change. But I will say I spent a lot of time talking to folks in the space, LinkedIn and Twitter, I won't call it the other thing. And a lot more people are starting to do this even as an experiment. So there's people who will go, let's go here for three months and let's see how it feels. And then they'll come back and then they'll reassess what their relationship to money is and their house and work and the balance with their kids. And a lot more people are just starting to talk about and think about this, which has been really fun the last couple of years. So it's not like you have to jump in and be like, I'm going to Guatemala for 10 years. We came here and we were going to stay for one year and here we are 11 years later and we're still 10 years later and we're still here. So just, I think you can take it in chunks and go for a few months and see if you like and then try a year and see what impact it makes.

[Scott Trench]

I, you know, I'm obviously very happy with my job and don't have not looking around on these things, but I know, like, oh, if I would like, hey, if I wanted to work remotely at Digital Nomad, I would want to go to New Zealand. Like that's a country that's been in my mind for a lifetime. And one, one of these years I'll spend a year in New Zealand maybe five, ten years from now. And that is a place where you cannot work. Like, it's very clear you're not allowed to work a job even remotely from New Zealand with a visitor without a, without a visa from their immigration center. So that's where I was kind of going with that question. It sounds like that issue just does not exist for you in Guatemala. And in some countries it's easier than in others. But do you have any commentary or thoughts on that for folks looking at geo arbitrage? Right, like there's two extremes. Guatemala sounds really easy. New Zealand, don't move to New Zealand and then figure out what work situation later because you're not going to be allowed to do it. They're not going to let you do it.

[Brooklyn Nash]

Yeah, I totally botched it on that, Scott, because I was thinking about the disadvantages of Guatemala or, sorry, the advantages of Guatemala rather than disadvantages elsewhere. But you're totally right. Do your research ahead of like what is required. Guatemala, if you're not a resident, you have to leave every 90 days. So you gotta plan for that and that's an additional expense. And a lot of countries like New Zealand, Israel, our first year, you can't technically earn an income there. You gotta work around things, right? So I was like working at the student writing center at the university and that was like one way around. And then I was like, like that's why we started on freelance income, because I'm like, the only way we're going to make money is by going back to US companies or clients and seeing if we can make money there because we can't earn money in Israel. So it really depends on the country. You're right, Scott. I think I. That just went right over my head the first time around.

[Scott Trench]

I was impressed with what seems to be a very favorable environment for you guys in Guatemala that encourages or allows this and that makes, that makes sense. Right. You know, Guatemala, it is not a different view on immigration than New Zealand does. Right. For various reasons. And I think that that's just something to take into account if you're looking to take the lessons learned from Brooklyn's story and apply them in your own life. If you're listening to this, I will.

[Brooklyn Nash]

Say this is very in the weeds of the mechanics that you were asking about. But the time zone makes a big difference. Guatemala is central time and mountain time. We were in Spain and Portugal last summer and the seven hour time difference, I was like, we were there three months. I'm like, this is not going to be sustainable. So we were exploring, like what would it look to move to Portugal? Nope. Guatemala's home. This makes it easy. We get to work with US companies and work a normal 9 to 5.

[Scott Trench]

Yeah, I think that's a big deal. Right. And that was also probably a big damper of my New Zealand dream there because that's a wildly different time zone.

[Brooklyn Nash]

But yeah, I don't even know what time it's over there.

[Scott Trench]

I mean, it's like if you have a client, right, like, and they're in mountain time, like you need to be available during mountain time. I assume, I assume these folks are entrusting you with big parts of the strategy around that and you got to be available for those types of things. And like your employer, if you're working remote, is probably going to make you work on their time zone, redo at bigger pockets. So that's going to be, you know, that that's something to consider as you, as you think about this geo arbitrage component.

[Brooklyn Nash]

Yeah.

[Scott Trench]

Well, Brooklyn, where can people find out more about you?

[Brooklyn Nash]

I'm LinkedIn. I'm Brooklyn with an I instead of Y Nash and our company is beam content. It's BeamContent Co if you want to find out more about the team and what we do. But yeah, I always love talking about this stuff. So if you're thinking about the geo arbitrage stuff or Digital Nomad or moving with your family, I've gotten on a few calls this the last six months with folks and it's always fun to chat through. So feel free to reach out.

[Mindy Jensen]

Awesome. Brooklyn, thank you so much for your time today. This was a lot of fun. I enjoyed meeting you in real life. We have been online friends for a long time. So thank you so much for your time today.

[Brooklyn Nash]

Thanks, Mindy. Thanks, Scott.

[Mindy Jensen]

All right, thank you for listening. That wraps up this episode of the BiggerPockets Money podcast. He is Scott Trench and I am Mindy Jensen. Saying until next time, Key Lime.