Why We Left

Why the Expat Life?  My reasons are different than those of the Tim Ferriss groupies.  Tim wrote The Four Hour Work Week which is one of the bibles for those who want to escape the 9-5.  It is an outstanding book that can help you take control of your life even if you have no desire to travel.  By the time the book came out, I had already finished my first year of living abroad and implemented many of the directives of the book.   While there was little in the book that was new to me, it reinforced my theories about work and running a business virtually.  The shortcomings of the book were that it was written from the perspective of a twenty-something guy who had few responsibilities other than to provide for himself.  There was not much in the book for people with families, like me.

1985.  After graduating from college,  I went to Japan to live and work as an English teacher and later as an importer—I was married and had two kids while in Japan.

1988.  We moved back to the US and since this time, I have run my own business and spent a few years consulting with other small companies as an operations director.   Export, import, direct mail, restaurant management, retail, wholesale, property management, internet based–I have been involved with a variety of different ventures.  Some made money, some lost money.

1990.  Our family grew to four children and responsibility grew with each birth.   My wife Maya and I were lucky to be on the same track about being strict parents so we were able to keep things in control.

Mid 1990s.  The middle-of-the-night terrors start.  Though my income had been going up steadily and I had some assets, there were storm clouds on the horizon all the time.  The worries were all financial in nature and manifested in the 1am wake-up telling me I was going to be ruined.  I would rapidly calculate my net worth in my head to shake the fear but the worries of my business failing, my commercial property not renting and my house catching on fire would leave me with the feeling there was no possibility of any ending for me but bankruptcy.  And that was not the worst of it.

Far worse than those fears was the terror of college costs because they were an absolute certainty.  College can cost anywhere from $25,000 to $250,000 PER kid.  Multiply that by four kids (and add the fact that they are close in age so the college years are nearly simultaneous) and you have a sum that is nearly impossible to save for.  I have smart, hard-working children and knew that they could get scholarships, aid etc.  But really, how much aid is going to offset a potential cost of a million dollars?  And what if I have enough savings and assets only for the oldest–what happens to the other three?  I am the Dad, the provider.  If I fail any one of my kids, I fail completely.

Even now, with the kids all graduated, my stomach still clenches when I think of the $15,000 bills I would get for ONE semester from some of the colleges—and then the follow-up letter a week later telling me I am late with my payment and my child will not be able to register for classes.  (Most colleges still do things by mail, meaning my on-time payment was received but the letter was mailed out anyway.)   On more than one occasion, I received a tearful phone call from my beautiful, sweet daughter saying she was notified that she would be locked out of her registration account because of a late payment, even though it had been received before the deadline and there was no balance owed.   Our four daughters have attended a total of ten universities in several countries, and the only ones that ever pulled this stunt were the ones in the U.S.   Even when you have the ability to pay and do all the right things, there are times when you feel completely powerless to protect both your investment and your child’s future.  Despite the thousands of dollars we have paid in tuition over the last few years, not once have we felt like customers who were being cared for or treated as valued contributors.   What other business charges tens of thousands of dollars for a product with no guarantee–and doesn’t even give you a free t-shirt or a nice thank-you card?   Even when you buy a car, you get a warranty—and the manufacturer doesn’t contact you every month asking for donations so that they can make more cars.

Added to this were the ups and downs of being an entrepreneur and the constant fear that we were only one major medical expense away from bankruptcy because paying $12,000 a year to your insurance company is not enough for them to actually cover anything.

Worry, fear, nightmares–this was my American life.  And yet, by all accounts, I was pretty successful.

Christmas 1997.  We took a family trip (flying on Christmas Day is very cheap and you totally miss the after-presents blues) to the Yucatan Peninsula in Mexico and spent 10 days living in simple huts near a beautiful beach with fresh fish, fruit and plenty of cold beer.  No payment was requested at check-in.  All six of us ate well several times each day (coffee, breakfast, beer, lunch, beer, snack, margaritas, dinner) in the sand-floored thatched-roof restaurant next to the huts without paying—they simply ran a tab.

After three days, I could not stand it.  I knew we must be running up a huge bill and even worried we would have to check out and cut our trip short as I had limited cash.  I asked to see our bill and they complied.   My jaw dropped—it was less than 30% of what I was expecting to pay!  I slept well that night and every night after in our simple little hut.   Finally, I could afford to relax.  I discovered an advantage to being an American abroad and found my mantra:

Income in dollars, expenses in pesos.

We vacationed in Mexico on several occasions and imagined ourselves living there some day.   Each time we returned from a trip, we brought an experience of Mexico home with us.  More lime on our food.  Mexican music purchased from street performers.  Jicama in our salads.  REAL Mexican tacos from the taco truck on the wrong side of the tracks.

Income in dollars, expenses in pesos.

2002.  To cut down on our vacation costs, we decided to pick a location in Mexico that had lots of flights and was closest to Oregon so we could get deals on airline tickets.  This location ended up being Mazatlan.  We visited Mazatlan three times in as many years.

Income in dollars, expenses in pesos.

During one of my 1am middle-of-the-night-college-costs-terror freak-outs, I had a flash of brilliance. If I could figure out how to make a living in Mexico, I could save enough on monthly expenses each month ($2,000 or more?) to pay for one month of college.  I filed that thought away and went back to my 2am college-cost cold sweats.

Income in dollars, expenses in pesos.

As my kids got older, I could see the effect of the American Marketing Machine on them.  As a family, we were pretty low-consuming (for environmental and financial reasons) but no consumption habits instilled in children can stand up in the American Marketing Machine’s primary domain….American middle school and high school.  Phones, tech toys, shoes, clothes, activities, personal hygiene products (?!), sports, cars, movies, birthday parties—if you don’t adapt, you lose.  If you don’t provide “adequately” for your kids, you are Loser Dad.  “Adequately” is not defined in any Dad Preparedness Handbook.

Income in dollars, expenses in pesos.

May 2005.  My second daughter went out with six friends (all top students in their high school) for a meal to celebrate the end of their junior year and her return from a year abroad in Brazil as a Rotary Youth Exchange Scholar.  She was recovering from a cold and we told her that she must take her cough medicine with her.

Returning from their dinner, one of the friends suggested they go to the house she was house sitting to watch Letterman.  She only had a backdoor key so the kids went through the backyard, took off their shoes (it was wet and muddy) and settled in for some laughs with Letterman.

I got a phone call at 11:30pm.

This is the State Police.  Is this Tom Frost?  We have your daughter in custody.  You need to come right away.  “Click”.

Fear.  Concern.  Terror.

I drove the 8 blocks to the other side of our sleepy, upper-middle-class suburb and saw flashing lights and a host of police cars and police SUVS.  I pulled up and told the officer who I was.  He used his radio to call for my daughter who was being held, in handcuffs, in the back yard.  She came out sheepishly in tears.

The story?  The neighbors called the police when they saw several high school kids walking through the backyard of a home of someone they knew was away on vacation.  The police came with drug dogs and had them run through the house searching for drugs and alcohol.  They handcuffed the kids and called the parents.  10 cars, 16 officers.  No drugs or alcohol found.  Carpet ruined by the dirt brought in by the dogs and officers.

The police confiscated my daughter’s cough medicine.  Apparently considered a drug.

Welcome back to America kiddo.  Your senior year is sure to be a blast.

Income in dollars, expenses in pesos.

June 2005.  I had a small business I started on the side in 2004 importing jewelry from China and selling it to retail stores in the US as well as selling it retail on my website.  Though we were doing everything on our own (sales, receiving, shipping, accounting) I had been testing a fulfillment service (a company that receives, inventories and ships goods).  The test was working better than I expected.   I was saving money AND having my goods shipped out more quickly—plus they had an online inventory/shipping website that I could check on my real-time inventory and shipments virtually–much better than me running to the warehouse and physically counting stock.

Income in dollars, expenses in pesos.

Sunday, July 3, 2005.  Maya and I were out for a Sunday hike in Portland’s Forest Park.  She had gotten a couple of orders for her new automated online mindfulness course that day and we were marveling that quite possibly she was making money even while we were out in the middle of the woods.  I talked about how much I was enjoying not making runs to the UPS store and wondering what I was going to do with the empty garage we had been using as a warehouse.  I also had to one-up her as I had a couple of retail orders that morning on MY website for some bracelets and I TOO was quite possibly making money as we walked in the middle of the woods.

Then it hit us.

If we could be in the middle of woods making money, then we could be in Mexico saving monthly expenses to pay for college.  We walked faster.

What about the house we had just bought for our office/warehouse. Sold it on craigslist.

What about our employees? Work from home with VOIP phones and a virtual CRM program.

Bank accounts?   Customer Management Software?  Wire transfers to China?  Faxing? Bookkeeping? Check deposits?  Credit cards?  Mail? Figured it out in two weeks.

Uh, what about kids’ education? Online or something.  Remember that cute little high school on the cliff overlooking the ocean in the historic section of Mazatlan?  Yeah, I remember.  That would be so cool—think how fast the kids will learn Spanish.  I bet they will learn a ton more every day there compared to what they will learn here.  Instead of 5 hours of education 5 days a week, they will be learning 24/7!

We were practically running down the path towards home so we could research everything we needed to know about moving to Mexico.

July 4, 2005.  At the extended family July 4^th barbeque we announced we were moving to Mexico within two months.  No one believed us.

August 26, 2005.  On the ground in Mazatlan after selling nearly everything we owned and making our businesses virtual.  It was the most thrilling and exhausting 7 weeks I have ever had.

That day was the most liberating day of this American Dad’s life and I knew I had made the best choice for my family and me.   We were free.  Free of stuff.  Free to live.  Free to learn.  Free to experience something new every day, every hour, every minute.

Income in dollars, expenses in pesos.

October 2009.  It is over four years later, my kids are graduated from college, I am NOT broke and I have a big grin on my face thinking about the last four years.  It’s been awesome.

Oh, and that income in dollars, expenses in pesos mantra?  Yep, still believe it, still say it, still live it.

And the 1am financial terror wake-up calls?  Have not had one since August 25^th, 2005.