After about 21 months, we have decided to enter the next chapter of our lives by ending the Dauphin experiment. We have purchased a house in lovely Summerside, PEI, Canada, and plan to move there next month. From today, we live only three more weeks in Dauphin, and of that, we spend a week on the road.
I declare the Dauphin experiment a rousing success! We lowered our basic cost of living to around $20k/year, which greatly increased the utility of every dollar we earned while we lived here. We bought our first house and paid only $35k for it. We hope to sell at a $5-10k profit once you include renovation expenses. On July 1, 2007, Sarah retired, and I followed on April 1, 2008. Since then, our rental properties have generated more net after-tax income than our basic cost of living. We made our first foray into business ownership with the Academy of Learning, and while that failed, we learned, although this time perhaps not cheap than an MBA. I bowled in a league for the first time since 1996 or 1997, I can’t remember which, and while I will finish the season with an average right around 200, I’m told that Parkway Lanes in Dauphin is a tough house and that I can expect that average to rise when I bowl elsewhere. I’ll believe it when I see it. We lived through a home renovation, we survived our first break-in, we bought our first steam shower and flat-screen TV… it all worked well.
So why move?
We had three reasons to move to Dauphin: low cost of living, bowling, houses under $50k. We had to sacrifice a few things to achieve our goal of early retirement: Dauphin has no book shop, coffee shop, movie theater, pool hall, Staples or public transportation (although the taxis come close). To travel for work or pleasure we have to either spend four hours on a Greyhound bus, or $800 round trip on flights and extra nights in the hotel. We happily sacrificed those things for what we got, but we made a few assumptions: first, that we’d travel only 2-4 weeks per year because of the low cost of living and the emergence of passive income streams; second, that I’d bowl in leagues here and eventually return to provincial competition; third, that we’d be happy with a small house. Of these, the first two have fallen away. Since we retired, we’ve traveled 50% of the time, not 5%, so living 400 km from Winnipeg airport has created a number of problems. I have learned that Parkway Lanes might close in the coming few years, which, combined with my not driving, would mean I couldn’t bowl. That meant we needed to look for somewhere to live with a similar cost of living and a stable bowling culture.
Enter Summerside, Prince Edward Island.
Yes, it surprised me, too. Sarah worked her research magic and within what seemed like minutes, we were working with a real estate agent. In early February our plan was to visit Charlottetown and Summerside in the spring, perhaps buy a house, then move in late summer. Instead, Sarah found a 1500-square-foot house less than 1 km from a bowling house, pubs, markets, a pool hall and less than 100 m from water. It sounded great, so we bought it. We then realized we could move in as soon as mid-April, which meant leaving here March 25 and not looking back. It has happened that quickly.
When we sell our house in Dauphin and one other property that isn’t generating any revenue for us, that will give us about 80% of the price of the new house in Summerside. We still won’t need a mortgage, although we’ll borrow on lines of credit for a few months. We will still have $30-35k/year in gross passive revenue of which 10% will go to a property manager and the rest will let us continue to retire. In a year we will recuperate our cash position, even including moving expenses and immediate repairs on the new house. We will retain our financial freedom while drastically improving our quality of life.
So, in about five weeks, we live there now.