How I Financed My Ticket to Vietnam

The end of April will come to mark my third trans-Pacific trip for Asian exploration. Instead of discussing the destination of Vietnam as a collection of descriptions about the food, history, culture or even country itself (I’ll do this in May), I’d rather focus on the how. How I afforded Vietnam. It’s not a crazy scheme involving sneaky travel hacking or anything similar—though diligence is always a priority here. Rather, it’s based on perspective and trade-offs.

Someone told me I was cheap the other day. Although this really doesn’t bother me from an outsider’s perspective, it is somewhat disappointing that this person did not understand my motivation behind some of the decisions I’ve made in terms of personal finance. What she calls cheap, I call frugal and purposeful. Save dough in aspects which aren’t important to me, and spend gobs, like a rookie NFL youngster with a newly-signed, multi-million dollar contract, in other areas I do value. Yeah that doesn’t really have a ring to it…but the point is I put money into things which give me the most satisfaction and then prioritize accordingly.

New furniture? Meh. I’ll check Craigslist for a deal, or ask a family member or friend, as it is very likely something used and in decent shape can be had for at least a 75% discount off the original price. To me, it’s woefully unimportant if the items match or if they go with the décor (which I don’t really have), so long as they serve their functional purpose. I’m not inviting you over to impress you with my new leather sectional.

New car? Please. Drive that off the lot and WHAM, a few thousand bucks disappears into thin air. Go for a used, older model. Does it get from A to B reliably? Is it reasonably efficient? Done.

Forego clothes shopping every few weeks or even every month. Check your wardrobe. The typical American consumer has way too many clothes…some still with the tags from years ago. Younger me is definitely guilty of this, but I’m improving. Besides the recurring costs of always having more this and new those, the decision of what to wear ends up costing “mental money” in the form of time and decision anxiety. Decision anxiety is like never being satisfied with the cereal you chose from the staggering 167 available options on the shelf.

How about going out for lunch every day? Being a bad cook shouldn’t excuse your penchant for eating out a majority days of the week. Your wallet gets slim, but your waistline expands.

Eat lunch out every day: $50-60 (5 day workweek)
Bring your own nomz: $15-20 (5 day workweek)
Average difference: $150/month and approaching $2,000/year!

Do you have cable? Pshht. Better cut that Comcast umbilical cord stat! You don’t need it. Everything you want is online, or most can be accessed through a lower-priced alternative like Netflix or Amazon. If your cable bill is $100 bundled with internet, but could be $40 with just internet, that’s a savings of $720 per year or about $600 in savings if you can’t quite stop your addiction and substitute a $10/month Netflix subscription.

This $600 brings me to my plane ticket. Roundtrip from Chicago to Ho Chi Minh City I paid $564.66. This is the trade-off: cancel cable (and even substitute in Netflix) and I can afford another plane ticket this year..and an international one at that. This is what I’m talking about in terms of values. If I really valued TV, sure I could get the extra channels. But I don’t. I hold the value of travel, cultural experience and discovery much higher than I value the ability to flip on the TV and watch Seinfeld reruns for hours on end…and I LOVE Seinfeld.

So when my friend said I was cheap, I in turn could’ve responded that she too was cheap. She was cheaper with her money towards plane tickets than I was, but she was less cheap with regards to a more expensive car. We have different values, giving both of us an appearance of being cheaper in different areas.

A lot of people fail to understand this concept. When you accept one thing (expense) you trade off the ability to afford another expense. By choosing to say yes to a bigger apartment, you’re essentially saying no (or saying no more often) to going out to dinner with your friends. And if you’re not trading off, well you’re gonna have debt coming out your nose and then AMEX is going to take your firstborn daughter as collateral.

Your income and time are finite. Therefore, trade-offs are essential.

There’s actually a really great quote to express this idea more succinctly than I ever could and it’s from a real estate/personal finance blog called Afford Anything. As the blogger Paula Pant puts it, “You can afford anything, but not everything.” And I think this captures the idea pretty well.

The Price of Coffee in Venezuela

It’s all about the Benjamins! Er, uh Burgermins? What if, instead of evaluating a country’s inflation using good old fashioned economic data, an everyday consumable was used in its place? You may have heard of the Big Mac Index. If not, this indicator basically compares global prices for the McDonald’s original two all-beef patties, special sauce, lettuce, cheese, pickles, onions – on a sesame seed bun.

The Big Mac Index is proudly served by The Economist, and was created in 1986 in order to assess “whether currencies are at their “correct” level. It is based on the theory of purchasing-power parity (PPP), the notion that in the long run exchange rates should move towards the rate that would equalise the prices of an identical basket of goods and services (in this case, a burger) in any two countries.” Yada yada yada.

But today (well last year) Bloomberg created a similar index, except focused on Venezuela specifically. If you have a Netflix addiction akin to heroin, have abandoned cruel reality for the latest in VR or otherwise find yourself treading water in a world of ridiculous and absolutely senseless memes and are unaware, Venezuela has been experiencing what some economists are referring to as runaway inflation. Exact figures are difficult to pinpoint but most sources put the rate well into the triple digits.

So, a new Big Mac Index substitute was born: The Bloomberg Café con Leche Index. The index tracks a cup of coffee (with milk) in eastern Caracas. Bloomberg states its price has spiked to 1,800 bolivars, up from about 450 bolivars during a span of 29 weeks. This index would then peg Venezuelan inflation at a staggering rate of 1,155% during that time.

The approximation reflects wide variation and remains a “best guess”. Other estimations I’ve come across for inflation in 2016 range from here at 290% and cap here at 800%, while most mainstream financial outlets trend north of 700%.

The index is admittedly unsophisticated, but it does track a product which is consumed every day and is monitored regularly.  It’s not an attempt to liken the situation in Venezuela to a cup of coffee (or burger), but to provide a more tangible method of assessing the financial pressure that has been unfolding in Venezuela over the last few years.

Binge-learn Spanish by Watching Narcos

Narcos on Netflix is my latest obsession in premium television and actually, contrary to most the other non-essential shit I consume, Narcos serves a valuable purpose for me—Spanish practice. I’ve been a Spanish learning hobbyist? for quite some time. Always intensifying practice around an international trip, then making honest attempts during subsequent months utilizing new podcasts or maybe reading Spanish newspapers online. Wherever my abilities lie, the rhythm of the language and memories of past trips to Spain and Central and South America have cemented my desire for improvement.

As far as Narcos is concerned, I think the reason this show has fueled my latest Spanish binge is threefold:

  • Centers around drug trafficking
    Drugs are bad, mkay? Most shows centered around drugs tend to include a combination of money, violence and corruption. These ingredients lend themselves to an addicting cocktail of a TV series, much like those found in The Wire or Breaking Bad.
  • Grounded in historical details
    The wildest and most devastating part is the series’ focus on historical events—they’re often tragically depressing and almost inconceivable (see Palace of Justice siege or Avianca Flight 203 for examples). Absolutely there is narrative stringing some episodes along, as this is a Netflix original, but Narcos does establish historical characters and presents them in a moderately neutral tone.
  • Primarily Spanish dialogue
    Since it centers around Pablo Escobar and the influence he played in Colombian life generally, and the cocaine trade specifically, it is likely to be best told in Spanish. Obvious, I know, but would you believe the actor playing Escobar is Brazilian?

A few hours a week I am transported to another country, thrown into the fascinating, yet tragic history that unfolded around cocaine in Colombia and the profound impact it carried forward for more than two decades. The producers filmed much of the series in Medellín and Bogotá, and throughout they weave together bits of authentic photos and videos. Since you’re seeing actual footage and archived documents, the series appears more genuine as you see haunting videos of the aftermath of street shootouts and major bombing campaigns. 

The first season chronicles the brutal rise to Escobar’s dominance. It explores the ruthlessness of his empire and the ensuing exchange of violence between rival cartels, the Colombian police and populist guerrilla fighters. You see both sides of the law—a view from the Colombian government and its hired help from the DEA, as well as Escobar’s family and business associates. Throughout, the Colombian people find themselves caught in the middle, powerless to the situation. 

Season two begins to look into the decisions which lead to the slow unraveling of Escobar’s Medellín empire.  As crazy and utterly brutal as his rise to the top is, the downward spiral of his reign is somehow even more riveting, especially once the viewer begins to get a glimpse “inside the mind” of Escobar during his last months on the run. 

Narcos makes it difficult to not want to improve (or learn) Spanish during/after watching. The series is addicting. The language is alluring. A planned season three and four are in the works, which no doubt makes it even more appealing as a continued alternative to the more conventional, and let’s be honest, less inspiring, language learning methods.

 

Original Index of Airbnb’s Most Hospitable Cities, Explained

Superhost to the rescue! That’s the Airbnb designation of an extraordinary host. They know better than anyone that bad reviews can kill you.

From my experience in booking an Airbnb (or hotel or any other accommodation) one of the things at the top of my checklist is a highly-rated experience from previous stays. If given a choice between a host with low average reviews or a newbie host with no reviews, I would likely roll the dice and stay with the unknown…and cross my fingers he or she is not a looney.

So where can you go to have the best luck with a stay? Read on, sister.

Back in 2013, and with just under one million trips completed in the United States (four million worldwide), Airbnb set out to find which cities contained the ultimate hosts. For reference, as of 2017, Airbnb guests have completed more than 150 million stays in over 65,000 cities worldwide.

Dessert first. Then the unexciting methodology will follow.

US Most Hospitable Index:
 (Mid-2013)

  1. Tampa, FL
  2. Mendocino, CA
  3. Eugene, OR
  4. Bend, OR
  5. Raleigh, NC
  6. Memphis, TN
  7. Madison, WI
  8. Nashville, TN
  9. Tucson, AZ
  10. Lake Tahoe, CA

Whattya’ see? Most are concentrated to a few regions across the U.S.

Maybe it’s the favorable weather in places like California, Florida and Arizona. Or perhaps it’s the proximity to outdoor activities in Tahoe, Eugene and Bend. Does sand-castle-making-access equal pleasant hosts, from Mendocino or Tampa? As pointed out by Airbnb, perhaps a college town like Madison, Raleigh or Nashville make for great reviews with laid back undergrads—host or guest. Are small towns friendlier? Four of the ten cities had populations in 2013 of under 160,000 and all cities are outside the top-20. Mellow hosts? By 2013, half the cities’ states allowed medical marijuana, which could make for a pretty easy-going host.

Those are just my fun facts mixed with an ounce (up to 8 in California) of speculation.

I posted Airbnb’s methodology in pretty lay terms below for the curious.

Index Methodology:

  • Used reviews to assist in determining most hospitable cities in U.S. (to quantify data)
  • The reviews are made up using the following categories:
    • Cleanliness
    • Check-in
    • Communication
    • Value
    • Accuracy
  • However, all reviews (1-5 stars) are NOT what make up the index*
    • The Index is determined by the percentage of trips which resulted in a 5-star review for all the previously mentioned criteria
  • Cities are limited to those which hosted a minimum of 500 trips in last two years
  • Only stays in which a guest booked a private room were used
  • The index also tried to control for guests by taking into account the guest’s origin

Airbnb Host Predictive Factors:
Airbnb tried to figure out which factors might be able to reliably predict a host’s score. To do this, they came up with a model based in probability. The full charts are interesting to see, but I’ve tried to cover a few highlights:

  • Younger guests (age 25-29) gave the most favorable reviews; older hosts (age 50-69) provided the best experience to guests
  • Guest factors based on gender weren’t much different, but female hosts tended to score a bit higher than the guys did
  • Stays under 2 nights or over 10 nights reviewed less often than the stays in the 3-9 range
  • The smaller the group, the more favorable the review
  • The further in advance a trip was booked, the more positive the review

Yes, the data was analyzed about 3.5 years ago. Things have definitely changed since then, as more cities have become available and Airbnb’s accommodations continue to outpace the growth of hotel chains.

The ten most hospitable is a great indication of where to stay, but it does leave me wondering where NOT to stay. A top-10 Least Hospitable Index would be perfect in order to avoid a disastrous weekend away.

You can read through the original data set that Airbnb provided here and draw your own conclusions.

 

The Force is Strong With This One (Dollar): Top 3 Destinations to Spend Your Buck

Imagine the US dollar has been lifting weights over the past 10 years, wearing an oversize hoodie and sweatpants. Today, the dollar rips off its shirt, heads to the beach and reveals its 6-pack abs and all around muscular physique!

Yeah, that’s the dollar I want to travel with, too.

Historic gains have been ripping through the S&P 500–the index is up almost 90% over the last decade. Like the US equity market, the dollar is also Superman-strong. As a U.S. citizen, or anyone holding USD, your buck has the potential to take you further than any other time in the recent past. I’ll show you just how much you can stretch that equivalent, value-menu Jr. Bacon Cheeseburger!

First, I evaluated the top traded currencies of 2016 to get an idea of how four quarters stacks up against the equivalent currency. Second, I noted other currencies which appear to be on sale and offer tremendous value.

Taking a longer term view, I figured how much the dollar has gained (or lost) from 2007 to 2017. For example, the exchange for the dollar to the Great British Pound was 1USD=0.49GBP, on average, over 2007. Today, that average exchange rate for 2017 is 1USD=0.81GBP.

I took this approach because I am much more interested in the value the current dollar represents today, over a period of a decade, than a year-over-year change. In a word, perspective.

I’ve come come up with a top-3 list of cities to visit, based on where the USD represents an extremely great value, considering the 10 year time horizon.

Buenos Aires, Argentina
Ten Year Value: 1USD=15.73ARS vs 1USD=3.11ARS
caminito-351167_960_720

All things being equal, your dollar will give you nearly 5X the value it did back in 2007. That’s insane! Sure, inflation has rocked Argentina over the past few years, but the value the dollar provides here cannot be ignored.

Vegetarians look away! Argentina knows a thing about a great steak, as its annual beef consumption ranks second to only neighboring Uruguay on a per capita basis. Make nice with a local and get yourself invited to an asado. Check out this mouthwatering page for all the details.

Expect great weather throughout March with temperatures ranging from 65-80°F (18-27°C), with an average around 71°F (22°C). Perfect for your street tango encounters.

An AirBnB along the famous Avenida 9 de Julio in March averages $45-$75/night for 2 guests. These rates are for an entire private home/apartment.

Cape Town, South Africa
Ten Year Value: 1USD=13.38ZAR vs  1USD=7.06ZAR
helicopter-1218974_960_720
The dollar has consistently grown stronger over the last 10 years with regards to the South African Rand. Today, your greenback affords almost double what it did back in 2007.

Take the cable cars all the way to the top of Table Mountain. With views of the bustling harbor and Cape Town Stadium to the north, this mountainous lookout provides incredible views of the South Atlantic Ocean and the port city below.

Swartland, a region about an hour north of Cape Town, has shot into the spotlight in recent years. Plan a trip here and see where some of the country’s best wines come from. And remember, since your buck goes twice as far, toast a second glass (or bottle; no one is judging).

Moscow, Russia
Ten Year Value: 1USD=59.1RUB vs  1USD=27.2RUB
moscow-1556561_960_720
Experience the crushing power of the Kremlin. You’ve no doubt seen colorful pictures of Saint Basil’s Cathedral, but the view from the cathedral into Red Square is one of the most impressive anywhere in the world. The surrounding fortress walls command dominance and offer a glimpse into the importance of the complex throughout its storied past.

Despite Moscow being quite an expensive city, if there ever was a time to visit, it’s now. Do yourself a favor though and visit during June, July or August, as these are the only months the average temperature is agreeable and hovers between 60-65°F (15-18°C).

Sure, the dollar is quite strong in a host of countries, but these three offer exceptional value and should be included in anyone’s travel itinerary if overall value is the objective.

You will notice that Mexico, Brazil, and other countries represent a great opportunity as well. However, these countries have consistently been less expensive over the long-term. I’m advocating taking advantage of large fluctuations in otherwise expensive destinations while you can.

Data compiled from: http://fxtop.com/en/historical-exchange-rates.php?MA=1