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Earning enough savings in 1 year to take a 4 year holiday

What would you do if you knew you had enough free cash to last you Four years? Save it? Take a holiday? Buy a new car? Quit your job? Go travelling?

What then if you had no debts, had a nest-egg already saved and your mortgage taken care of?

It’s a tough decision isn’t it! I bet nobody in the world would want that choice. Do you want Cake, Jelly or Ice-cream?

 

For me, I decided to take time out to travel and do my own thing. Twelve months after leaving my job and I can honestly say it was the best thing I ever did in my life.  Its given me time to decompress and allow me the opportunity to work on projects that I always wanted to do but never really got round to. It also gives me the option to choose wisely the next path I take, like returning to work in a company I really want to work in, instead of coming from a drive of desperation and accepting the first offer. Instead, there is the option to go back to formal Education, or even start a business. These options really didn’t feel viable from when I was working at a salaried office job.

Every day I get to do the activities I really want to do; study Languages, read up Personal Development and Computer Software, whilst setting my own schedule. I can go meet friends for coffee, watch a movie, or sleep in. The surprising thing is that I feel like I am the least lazy I have ever been in my life! Although I might “work” for less than 6 hours a day, those are action packed 6 hours and I love every minute of it. And the quality of my work output has never been better. I never learned a new language as quickly as I have done, and I can quickly find elegant solutions to software solutions, whether it be debugging, looking at a new plugin for wordpress or doing an online programming test. I don’t have to worry about earning money for 4 years because I know what I have will last that long. I am sure that I will find something to extend that time, so long as I am open minded enough to search and find it.

 

You might ask how on earth I managed to get into this seemingly privileged situation in the first place. It all started with the decision to reject the situation I was in and to search for a better solution. It was also a terrifying decision to make. The decision to stop working and stop a “career path” flew in the face of everyone around me. I got comments from close friends and family such as ..

“You already have a decent job and life, why throw it all away?”

“So if you take a year out now, when do you plan on getting married?”

“What will you do when you run out of money?”

“If you leave you will never have things as good as you do now”

“You are jeopardizing your career by voluntarily taking gaps”

 

If someone told me earlier that this was all going to happen, I simply could not have believed it. It was 6 months after leaving my comfortable but boring life in UK. I was in Tokyo, working day and night just to scrape together a meagre existence living in a shared dormitory with 12 people. I remember walking outside seeing homeless people and envying them. They seemingly had all the time in the world and they had their own little cardboard box homes to live in and they weren’t about to get kicked out the country because they were about to run out of money!

Every day was a real grind. New requests came in for new features to the project I was working on, there seemed to be no end in sight. I was taking two or three English teaching classes per week to have some kind of cash flow whilst waiting for the big project payoff. My expenditures were reduced to coffee at MacDonalds (taking the laptop to work there at the same time, of course) and fishing out the reduced price food at the local supermarket. At the same time I was searching for new contracts or jobs to keep going. And all the while still studying Japanese!

I distinctly remember going for an interview at a company and failing miserably at a relatively simple programming test. I realised at that point I was burning out. But I couldn’t stop on any front because everything was so important.

There were times I just couldn’t understand how things could get this way. Only 6 months earlier I was living the comparative dream in UK. It was an 8 out of 10 life. Boring, but no overtime, easy work with no pushy clients to deal with, my own car, my own room! And I gave up that cushy life for this. The worst part was I had freely chosen this path. It felt like the biggest mistake I had ever made. I was very ready to “vanish” and go back home, defeated.

But things got better. Finally the project came to an end and I found myself finally with free time. I still had other commitments but the biggest one had finally let up and I had some time to myself. I had the time to search for a new place to live and found a room in a guest house. Because of the 2011 earthquake, there was less foreigner demand for rooms so I managed to get a reasonable discount. It was still twice the price of the dormitory, but half the price of a single studio apartment. It was a decent sized room (for central Tokyo) with double bed and my very own air conditioner! I had never appreciated having my own private space before in my life as much as I did at that point.

Things got better still. A CV I sent out a few months earlier to a recruiter website had been picked up by another recruitment company, and I was offered an interview. I didn’t have high hopes because I had already had at least 10 interviews in various companies in Tokyo. Only one job offer came from that and the salary was too low for me to reasonably accept. However, I got the phone call and I was offered a 1 year contract. What’s more is the recruiters had negotiated a salary 33% more than I had asked for! I couldn’t believe it! A huge weight had been lifted off my shoulders.

At this new job, they had regular hours like a real company. I was so relieved that I could go to work at 10am and leave at 7pm. That was still worse hours than I had back in UK, but compared to my previous work it was a dream. And they actually paid for overtime!

I still kept up the routine of eating cheaply. I bought myself a rice cooker and bought salad and meat daily. There was a bento shop near my place, so I could eat lunch for just 250 yen (USD2.50) That food tasted unbelievably tasty, considering I couldn’t afford to eat that just a short time earlier. Each month I was able to save about 55% of my take-home wages without really trying. I was still living a reasonable life; going for the occasional lunch at a restaurant, going out at weekends and holidaying to foreign countries.

By the end of the contract, I had saved up a healthy savings account; enough to live for 18 months in Tokyo at my current burn rate. However my plans had changed and I wanted to learn Chinese. I made the decision to move to Taiwan under a Working Holiday Visa. This was a new visa for UK Citizens under 30, and because I was 29 at the time it made perfect sense.

It turns out that living costs in Taiwan are significantly less than that of Japan, so my 18 months forecast actually turned into 4 years.

But more important than the money is the experience. From my experiences at the bottom, I now have the capacity to work 12 hours non-stop on a project, or to get through the wall when it comes to studying or reading books. I have the drive now to push myself forward and find out more things that I didn’t have before. The money merely provides time such that I can use to study or work on new projects.

 

How to make this a reality for you

Despite these savings, and the experience of doing it all already, there was still resistance to the idea of leaving and starting all over again. There was still the chance that everything could go horribly wrong and I lose everything with nothing to show for it. Or worse, I couldn’t pick up a job because I had Another huge gap in my career.

The biggest issue is taking the decision to step out of the current situation and into the unknown. It took me one full year of frightening uncertainty and having things worse to get to the position of earning enough money in one year to last for four.

One thing’s for sure, you can never find out the solutions until after you step out into the wilderness and summon the courage to find out for yourself. And it really does take life or death situations like that in order to push you to find a solution. Things will almost certainly get worse, but I promise if you keep on going and searching for new answers, you will find the ultimately better solution.

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Owning and Driving an LPG modified car.

I’d like to give my experiences with buying and using an LPG car. The advantages are cheaper fuel and road tax and its better for the environment. Having a conversion has almost no impact on the driveability of the car, although other considerations that must be looked at and the initial cost of conversion is expensive. The intention is to show what considerations should be made if you are thinking about going down this route to see whether its appropriate for you.

Everyone has fond memories of their first car. My car was a 13 year old Citroen XM. The most amazing car that has ever been produced! An ‘executive’ size car, with a 2 litre turbo and Citroen’s amazing Hydractive suspension; pull a lever and the car ride height would actually rise and fall.

Affectionately nicknamed “Starship Enterprise” by my friends, you could almost mistake the looks for a cheap man’s de-lorean or an old Lotus Esprit. However this futuristic masterpiece under-lied a terrible secret. It was the most unreliable car ever to be produced by Citroen. And that says a lot, because Citroen is french for lemon. Countless times I would be told by the onboard computer that I hadn’t shut my door, my brake lights were broken or that I had to check the LHM levels. This last one was rather frightening because the LHM fluid is what kept the suspension, brakes and steering working. Above all else, I got less than 20 miles per gallon.
The short time I had this car showed me that I needed to consider practicalities when it came to cars, which is when I first heard about LPG.

What is LPG?
I’m sure google can answer this question better than me but what it meant for me is a lower cost fuel alternative for petrol cars. A petrol car can be modified to take LPG (Liquid Petrolium Gas) which is taxed much less than petrol or diesel. Its approximately half price for a litre of petrol.

At the end of last year I found myself driving 2 hours a day to work and back, so my weekly fuel costs were quite considerable. After some research, I decided to invest in a decent car, and have it converted to LPG.
I found a small garage near where I lived who specialised in LPG conversions. The owner was very friendly and explained to me the basic process of having a car converted, driving and using a car fitted with LPG and costs involved.

After consideration I finally bought a Mitsubishi Colt 2005 with a far more reasonable 1.3 litre standard petrol engine. I handed my car in to the garage for a couple of weeks and they fitted the new LPG system. I had a 60 Litre tank fitted but more on that later.


Getting used to the LPG system
When I came to pick up the car from the garage, There were three major noticeable differences. The first on the outside of the car there was a black and gold connector. This is the point where the gas is filled into the car. The second difference, inside the car, a new instrument indicator to show the status of the LPG system. Finally, in the boot, there was a huge tank fixed in place.
A new tank is required to store the different fuel. This is because LPG is a pressurised gas which must be kept air tight.

We drove to the nearest LPG fuel station to fill up. Upon starting the car, I had a to wait a minute running under petrol, before switching to LPG. This is because the LPG fuel must have perfect operating temperatures, a device called the Vaporizer must warm up before being able to use the fuel. As a result, LPG car conversions are actually duel fuel. They can run both petrol and LPG. This is handy if you run out of LPG and cant find an LPG station.

The filling up process is slightly different from a petrol or diesel car. You have to ‘lock’ in the nozzle to create an air-tight seal, then step back and press a button on the fuel pump to fill up. The fuel only comes out at a standard rate, unlike petrol where more comes out if you squeeze the trigger harder. When the tank is full, you hear a click and the flow automatically stops. This is convenient as it prevents overfilling the tank.

Driving the car has been identical to driving a car before it was converted. The engine sounds exactly the same, has the same power and handles the same. The only difference whilst driving is the indicator on the dashboard to show whether or not LPG is being used in place of petrol.
Petrol still must be used to start the engine each time its switched on, so you need to fill up once in a while, I think I used about 5 litres of petrol in a month. I noticed the LPG fuel indicator is not entirely accurate. It has 4 lights to indicate the amount of fuel left in the car but sometimes I’d start the car and there would be 1 light on (25%) and then it jumps to 2 lights (50%). Because there is only 4 lights, being out by 1 light is very inaccurate. The garage owner taught me the solution to this. Instead of using the gauge, always fill the tank to the maximum and then reset the trip counter on the dashboard. After a few journeys you can get a feel for how far you can drive on one full tank. In my case, I get about 410 miles in my usual every day driving. This has now become my gauge of my fuel, and its actually more accurate than the normal petrol gauge because I am usually accurate to about 5 miles. It is OK to run out of LPG whilst driving. If you do, the car automatically switches back to petrol seamlessly. In fact, the only way you do know is because the indicator on the dashboard beeps at you to tell you! Just don’t run out of petrol.

A Quick tip to save more on the petrol. When the car is started in the mornings, it can be driven straight away as usual, however it takes a minute or so for the LPG to kick in. I have found if I just keep the car parked during that time, I use much less petrol. It also warms the engine just slightly more before driving so should keep the engine in a better state as time goes on. When I fill up on petrol, I only put in about 5 litres, up to about ¼ of the tank. Petrol can go stale if it is not used for a long time so best not to have too much in there. But remember to keep enough such that if you run out of LPG, you can still drive to another fuel station, be that LPG or standard.

Not all petrol stations have LPG, so its important to plan ahead for which station to go to. For me, I discovered 2 stations between my work and home, so I used them. Beware that the prices between stations vary quite dramatically, as much as 10p per litre. This could quickly escalate in lost savings, especially for me considering I used more than 60 litres a week.

Ive had a couple of problems with the car since the installation, these have been a small gas leak outside the car (nothing to worry about, apparently..) and the LPG system stopped working at one point, it had to be repaired. Both times the garage took care of it under warranty and were very quick. The system was fitted by an authorised dealer and I am confident of the safety. There are certificates for the gas tank, installation, and a yearly check must be done on the gas system to ensure safety.

Was it a success?

The reason for my interest was to save money, so Ill break down the costs and savings.
The conversion kit cost was 1750 pounds, so to make things worthwhile I’d have to save that amount of money or more on fuel costs. The class of the car changed for road tax purposes, but that saves only 30 pounds per year.

Because fuel costs are so volatile its difficult to predict how things will go in the future. However, after getting the conversion the savings after were immediately visible at the fuel pump. One litre of LPG cost 57.9p, one litre of petrol was 112.9p. Its not quite as simple as that however, because the miles per gallon is slightly less with LPG. Instead of the 40 miles per gallon I got with petrol, I instead got 35 or so. However, considering the cost difference per litre, I worked out that per mile, LPG costs about 60% as much as petrol.
To put it another way, in order to make the same cost per mile, I would have to have a car which could do about 73 miles per gallon of petrol.

At those fuel prices, I calculated that it would take roughly 40,000 miles to break even on my initial investment. That would take me 2 years of driving to and from work 5 days a week. Considering the car already had 34,000 miles when I first got it, that would take it up to 74,000 which may then make it time to get a another car. So it would appear that I may just about have broken even if I continued to do those journeys for two years.

Overall I would see this experiment as an interesting one, albeit not quite a financial success in my case. It is true that savings are there to be made, but it is over a long period of time and there is the considerable investment cost at the start. In addition, I no longer have a boot! This isnt a problem for me, as I just put shopping and luggage on the back seats. However this may not be a solution for everyone. The gas tanks come in different sizes and depending on the size of the car, you can get an appropriately sized tank which gives you the range you need and leaving enough boot space. These are custom installations which can be fine tuned to your particular requirements.

To surmise, I would recommend doing the facts and figures on having an LPG conversion before taking the plunge. Usability-wise, there are only a few settling-in issues but they have been taken care of now. Actually driving the car itself is identical to driving before. I must admit it is a good feeling going to the station and filling up for half the price as the average driver.

In my personal situation, I needed to have a car with a long driving range, and didn’t need a boot, so thats why I chose a large tank in a small car. These sorts of decisions can be made per individuals personal circumstances.
I’ve heard from the garage owner that people with larger cars tend to go for LPG conversions more, as their miles per gallon is typically low, they make comparatively larger savings. Also, the performance is retained on the engine.

Driving LPG is certainly a viable alternative, and over time the advantages can be seen. And you can take pride that you are doing your little bit to save the environment :) Of course, the real savings come from not having to drive at all, but that if course is dependant on your own circumstances. For me, I don’t fancy cycling 100 miles a day, and public transport is more than twice the price and takes twice as long.

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