Geographic arbitrage and the beauty of having a Plan B

I once helped cure the financial anxiety of a French fund manager.

He was stressed out by his job (he was worried – with some justification – that the robots were coming for him) and his London lifestyle.

Perhaps you too would like to feel less anxious (and get better with money)?

If so, please continue and I will tell you the same story that I told him. Unlike much of the stuff on the internet, it has the advantage of being 100% true.

It all started on a family holiday. Several years ago, I was on a “bucket and spade” holiday with my wife and our three children in the French seaside town of Le Barcares.

Le Barcares is on the Mediterranaen coast of France. But it’s not part of the French Riviera of Cannes, Nice and St Tropez.  There are no superyachts, Ferrarris or Holywood stars in rehab in Le Barcares. Or at least, none were in evidence when I was there.

Le Barcares is where ordinary French people (teachers, plumbers and electricians) go in August. There are no Brits on the piss holiday there (which some might say is part of its charm).

It has beaches. It has a fun fair. It has a local market selling produce. It’s all du pain, vin rouge, croissants and good salt-of-the-earth French seaside fun.

The climate is beautiful most of the year and, even in the winter off season, you could live there very happily indeed. The food in the supermarket was plentiful and priced very reasonably. One of the great ironies of modern life (especially in Europe) is that peasant style produce is the best food, the healthiest food and the cheapest food all in one.

As we wandered around the town, I looked in the windows of the estate agents. I noticed that you could buy a lovely 2 bedroom apartment in any of the several clean and modern blocks near the seafront for like 50,000 – 60,000 Euros. No, that is not a typo. Buy…outright…no mortgage.

So here’s the deal. It’s the same sun as you get in St Tropez and the same sea. But for a fraction of the price.

Now this was not Plan A for me, my wife and our 3 children. I am a huge fan of France but my provincial English background (‘Allo ‘Allo has a lot to answer for) taught me that bringing up your children as French is basically child abuse.

But here’s the thing. If you are prone to “worst case scenario” thinking, it’s hugely reassuring to know that you could just sell up in the UK and live mortgage free in a beautiful Mediterranean seaside town. There are worse ways to crash and burn in life. Even if your kids end up speaking with zees aksont.

I told the French Fund Manager this and you could see the look of realisation dawn upon him. The cogs started to turn and you could see him doing the mental maths….proceeds from a sale of his London terraced house plus the savings on London private school fees…equals KER-CHING! 

Not only did he already know Le Barcares, he had grown up within an hours drive of it. He knew how good the beaches, the schools and the hospitals were there. But he had got so wrapped up in The Prison Camp mentality in London that he had forgotten about places like Le Barcares.

He processed the news that he was ALREADY financially independent…all he had to do was move.

Here’s the really interesting part. Maybe he didn’t actually need to move? Just the realisation that there is another option (should you need it) can lift a huge weight off your shoulders and help you see more clearly.

And once you see you have options, you are better able to continue doing the high-stress, at risk job that you may currently be doing. Or make the leap. Either way, it’s better than staying stuck in your own mental prison.

When to make the leap? It depends on your unique circumstances. Usually health and wealth go together. But they can conflict and there came a point for me where I chose health.

Stress and inflammation affect the immune system. Your body keeps score and will give you feedback. In my 30s, I noticed that I was getting more and more infections and injuries. You will know on some level if this applies to you.

Then, when I was 40, I received a wake up call from The Universe that finally sunk in. I was working late one evening and I read on the internet about a 44 year old guy who worked for a bank as a corporate finance adviser (i.e. the same job as me). He’d been found dead of a heart attack at his desk in Canary Wharf at 7.15pm on a Friday evening.

Is it co-incindence that I quit my job shortly before I turned 44? Probably not.

Was it helpful to have this wake up call in order to overcome one more year syndrome? Absolutely…I wasn’t sure whether I had enough to never work again but I knew I had enough financial runway to build a new life and a new career.

Le Barcares symbolised my fallback options. For me, Le Barcares will always represent Plan B (or C or D). The ability to think outside the box, the ability to mix things up to improve your life.

Here I am not talking about frugalista cope. Here I’m not talking about making the best of a bad situation (important though that can be).

No, here I am talking about the ability to change your mental paradigm and see new options and choices from a completely different perspective. That is why it’s good to talk.

Love to everyone…even the French.

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