Moving Day

Up at 5am. Packing boxes. It is amazing how much stuff we crammed into roughly 500 square feet of living space.

We have filled 20 or so U-Haul boxes and we might have another 3 or 4 to pack.

Doesn’t include three guitars, audio console and monitors, all the computers and related technology, all the cameras, bike, golf clubs, books and whatever else we decide to take with us from the coach for the next six months.

We will leave very little behind in the coach. Ladders, tow bar, air compressor, kitchenware and perhaps a few other odds and ends. All the furniture and appliances will remain.

Soon the coach will be empty. And soon it will be left alone to face the harsh winter of Canada.

We will be heading out to the house in another few hours with one load of boxes. It will probably take 6 or 7 trips from the coach to the house to finish the move and that will be done this evening and tomorrow.

Friday the coach will be thoroughly cleaned and then off to the dealership.

The coach has been our home for the past two years. The government has caused us significant stress as full-timer RVers ultimately forcing us to change our lifestyle and to leave our home on wheels. All to help prevent the spread of COVID-19.

We have complied with the COVID-19 rules, regulations and recommendations from our government and we will continue to do so.

But I’m not happy about it.

We Get A House

It wasn’t supposed to be this way. Until the COVID-19 crisis came along. And that changed everything didn’t it?

When this pandemic began we left Florida a month earlier than planned.

Because of fear. Because of border closures. Because of government.

We came back to a country that was still very much in the grip of winter and we spent two weeks in quarantine and then another month after that parked in the lot of a motorcoach dealership, uncertain as to whether we would have any place to park our coach. Governments had initially allowed campgrounds to open and then shut them down. We were in limbo for the better part of a month.

Our site did open on May 1st. For the following two weeks we enjoyed the wonderful weather that one can only find in Canada during early May.

This was exactly the weather that we were hoping to avoid in retirement. That and the stress and anxiety that goes along with being uncertain about where we might be able to park our coach.

Government has made it impossible for us to plan our travels this year.

There is no plan by government to re-open the border. The so-called temporary closure of the border, in effect for a 30-day period, continues to be extended. 30 days at a time.

The latest one, August 21st, has already been extended to September 21st and, no doubt, will continue to be extended indefinitely. Never in my life did I imagine that our government would suspend our mobility rights. Except, for some odd reason, travel by air.

29 bipartisan members of the United States Congress issued a formal request to the Canadian Public Safety Minister, Bill Blair, to plan for the re-opening of the Canada-US border.

The members of Congress made this request:

That the United States and Canada immediately craft a comprehensive framework for phased reopening of the border based on objective metrics and accounting for the varied circumstances across border regions. We understand the importance of prioritizing the safety of our communities as we all navigate the complex calculation of minimizing public health risks and resuming economic activity. However, the social and economic partnership between our two nations necessitates a clear pathway forward.

Chrystia Freeland, Canada’s Deputy Minister,  responded with a statement that the absolute priority is the health and safety of Canadians saying that decisions about Canada’s border are made by Canadians, for Canadians.

Translation: we aren’t going to open that border anytime soon. We aren’t even going to plan to re-open.

The letter from Congress was issued on July 3rd. At that time the United States had the highest number of infections in the world at roughly 2.2 million with 120,000 deaths.

As of yesterday, the number of infections in the United States was roughly 5.5 million with 171,000 deaths.

With those numbers, we know that the border is unlikely to open when we have to leave our site in two months time. We know that many snowbirds will not be travelling south this year. We know that it takes time to find housing.

We had to make a decision about where we would be sleeping this winter.

We signed the papers yesterday. We have a house.

But just for six months.

We have rented a beautiful home on the lake close to our current location. If we have to spend a winter in Canada, we might as well do it in style.

The coach will go into storage until the spring. We will return to our current site next year. And then we will see where things stand.

Worrying about whether we will have a place to park our coach was not the game plan in retirement. If the COVID-19 crisis continues unabated with governments imposing lockdowns on travel, we will have to revisit whether this is how we want to be spending our time in retirement.

One of my friends suggested that we buy a house and hold it for a year or two instead of renting.

Most Americans would be shocked at what passes for real estate in this part of Canada. Want to see what a million will buy you in Toronto?

It’s just as silly throughout most of the Greater Toronto Area. Even the area where we are currently parked. Real Estate in the densely populated areas of Canada has become a Ponzi scheme, a bubble just waiting to burst.

Until we make a decision on what happens next in our retirement journey, I am not willing to put millions into real estate. Not during a global pandemic. Not during an economic depression. Not during a period of crazed speculation with overinflated housing prices.

Much easier for now to lease for a few months.

How Much Does It Cost?

How much does it cost to full-time in an RV? I see this type of post frequently online. I’ve been asked the same question many times since Lorraine and I became full-timers.

You will find some very detailed budget updates online like this one from 2018 by Mortons On The Move. They summarize their costs here:

​Our initial budget estimate was somewhere between $2500 and $2800 per month. We are very happy that we’ve been able to make this lifestyle work at much less, around $2000 per month (not including health costs, business expenses, and paying taxes). We continue to look for ways that we can reduce our overall monthly costs, and are still very frugal about what we buy and when.

We spend more than $2,000 per month USD just on site costs alone when we stay in the states. I applaud the Mortons for being frugal, but we do not spend anywhere near that little on our lifestyle. And, thankfully, we do not need to.

The Low Income Cut-off (LICO) in Canada represents the poverty line in urban areas with a population of 500,000 or more. If your income is below LICO, you are poor.

In 2020, the 12-month LICO for a couple in Canada is $32,270 CAD or roughly $2,000 USD a month.

I suppose it is possible to live the RV lifestyle on that small amount of money and it looks as though some people can do it. We don’t. And most of the people we know that are living this lifestyle don’t.

We see very little difference between our cost of living in a house and the cost of living in our coach. We own our coach and our car free and clear and, if we were still in a house, we would also own the house free and clear.

Our cost of living has been roughly the same across these categories save for federal taxes:

Taxes and Deductions

  • Federal Tax
  • Health/Dental

Automobiles

  • Vehicle Insurance
  • Gasoline
  • Maintenance
  • Tolls/Parking

Discretionary

  • Clothing
  • Dog Care
  • Donations
  • Education
  • Entertainment
  • Fitness
  • Gifts
  • Technology Hardware
  • Technology Software
  • Vacation

Food

  • Dining/Restaurants
  • Groceries

Housing

  • Property Insurance

Insurance

  • Life Insurance
  • Travel Insurance

Utilities

  • Cellular
  • Electricity
  • Internet
  • Satellite TV

Professional Services

  • Dental
  • Medical
  • Legal

The differences as a full-time RVer? Not much really. Our costs for the above categories would still apply regardless of how we were living in retirement.

In the RV lifestyle we spend more on transportation costs, specifically diesel fuel, vehicle maintenance, licensing fees, site fees and storage unit fees.

If we were still in a house, we would have to allow a budget for property taxes, property maintenance and household improvements.

We did not see a dramatic reduction in our cost of living in retirement except in one area: income taxes. My tax bill is finally reducing as we shift from employment income to investment income in retirement. But that has nothing to do with living in an RV full-time.

If you are wanting to live a frugal life or reduce your spending, there are many ways to accomplish that goal.

I’d suggest you start here: Your Money or Your Life. You can thank me later.

If you are having trouble living within a budget and you think that living in an RV full-time will resolve your budget issues, I’d say think again. You take yourself into whatever lifestyle or situation you choose. If you had trouble managing money in a house, you will have trouble managing money in an RV.

No Quick Recovery

A quick recovery? Back to normal in another few weeks? I remember having this debate with a few of my friends in Florida back in the early days of the pandemic. The thought was that the economic damage would be short-lived and a full recovery would happen within a quarter or two. I was not that optimistic. And I see nothing that suggests our lives will be returning to normal anytime soon.

From TheStreet:

Federal Reserve Chairman Jerome Powell said the pace and scope of the current U.S. economic downturn are ‘without precedent” and cautioned that recovery could take longer than expected to gather momentum.

“The scope and speed of this downturn are without modern precedent, significantly worse than any recession since World War II. We are seeing a severe decline in economic activity and in employment, and already the job gains of the past decade have been erased,” Powell said. “Since the pandemic arrived in force just two months ago, more than 20 million people have lost their jobs.”

“While the economic response has been both timely and appropriately large, it may not be the final chapter, given that the path ahead is both highly uncertain and subject to significant downside risks,” Powell added.

Brett Davis, CEO of National Indoor RV Centers, posted a video a few weeks back where he provided his perspective on the state of the RV industry. The video is long but worth the watch if you have an interest. Here is what he had to say about the market:

With our economy completely shutdown for the month of April and then reopening of America to come in three phases over time I suspect the second quarter earnings and beyond to be awful. Every investor and fund manager will begin to wonder and worry about where the bottom will be for earnings. No one will want to try and catch a falling knife. I do not believe we have seen the bottom in this stock market.

Winnebago announced a resumption of operations which you can read in full here. However, there is a disclaimer:

Since the beginning of the COVID-19 crisis, Winnebago Industries has implemented significant cost containment and financial management measures and will continue to do so as conditions require.

While we closely monitor community conditions related to the pandemic and track consumer appetite for our products and outdoor activity, our organization will continue to make necessary and critical decisions around expense management, capital deployment, and strategic product development that will ensure our long-term financial stability and position our incredible team to compete successfully in the future. We remain convinced that the powerful appeal of the outdoors will endure through these uncertain times and end consumers will increasingly be attracted to the RVing and boating lifestyle.

The great financial collapse was a severe financial crisis that caused a deep and painful recession. Technically the recession ran from December 2007 until June 2009. It took many years for the economy to recover to pre-crisis levels of employment and output. The great financial collapse was a result of financial imbalances that had started primarily in the housing sector. A very different class of economic recession than what we now face.

Financial policy makers are preparing for the possibility of a far deeper, more protracted downturn. A quick recovery is unlikely. I get concerned when the chairman of the Federal Reserve characterizes the pace and scope of the current downturn as being without precedent. That does not sound very encouraging does it?

Eventually we will see things turn around. But it won’t be this month. Or next. It may take years.

Today I began looking at properties to rent. Perhaps the border will reopen for snowbirds in the fall. Given all that is going on, it seems prudent to consider alternatives.

Just in case there is a second wave coming.

 

Weighing Our Options

Florida this winter? Or, more broadly speaking, any form of non-essential travel this year? Or next? Or, for that matter, will life return to normal anytime soon in Canada?

Our Prime Minister provided this optimistic and encouraging perspective yesterday:

OTTAWA — Prime Minister Justin Trudeau says that “normal” is a “long way off” for all Canadians — and that some differences implemented as a result of lessons learned during this pandemic will last for “years.”

“If we want life to get back to the way it was exactly before, it won’t,” Trudeau said, speaking to reporters from the front steps of Rideau Cottage on Monday.

You can watch his response here.

My financial adviser gave me his perspective:

Few aspects of life have escaped change. Civil liberties, for example, have been slashed. So far most people are willing to trade unemployment, inconvenience, long hair, huge deficits, closed borders, self-anointed cops and draconian rules for what they’ve been told is a reprieve from death-by-virus. Politics are being altered. Trudeau’s approval rate has soared. Trump’s is faltering. Public finances may be changed for a generation or more. Your child’s child will still be paying COVID-19 taxes. Airplanes won’t be fun anymore. Mass events are done. Packed bars and open-concept offices may be a year away. Or more.

I love this closing quote from War of the Worlds:

From the moment the invaders arrived, breathed our air, ate and drank, they were doomed. They were undone, destroyed, after all of man’s weapons and devices had failed, by the tiniest creatures that God in his wisdom put upon this earth. By the toll of a billion deaths, man had earned his immunity, his right to survive among this planet’s infinite organisms. And that right is ours against all challenges.

Except, possibly, the COVID-19 challenge.

Fear of death is a potent fear.

Lorraine and I face a decision. One that we will have to make over the next few months.

Our options:

1. Keep going. Everything will be back to normal in a few months.

With this option we are free to travel in our motorcoach and we can return to Florida as planned in early November. Possible? Perhaps not. Canada may well continue to restrict our civil liberties and we might be unable to travel freely into the United States this fall. I put our chances of being back to Florida this winter at 50/50.

2. Store the coach and rent for the foreseeable future.

Make arrangements to find a rental property somewhere in the area, put the coach in storage, and ride things out for a year. Ideally we would prefer to rent from October to May so that we could return to our coach and to our site in Canada next year. I’m not sure if that option would even be possible and I am not very keen on committing to a 12-month rental term and I am definitely not keen on being in this part of Canada during the winter months.

3. Go west and spend the winter on Vancouver Island

It might be cooler on Vancouver Island than Florida during the winter months however it would be downright balmy compared to an Ontario winter. Would we be able to travel freely in Canada? It might surprise some to discover that 8 provinces and territories in Canada have implemented border checkpoints and travel restrictions. We have a mobility rights provision under our Charter. Provincial governments are violating our constitutional rights to travel freely in the country and the only recourse would be to challenge their actions in court. That won’t happen anytime soon. We might well be turned back at any one of the provincial borders if we tried to travel west.

4. Sell the coach and buy a house.

This is not an option that we would willingly pursue.

We did not anticipate these types of issues as Canadian snowbirds travelling full-time in our motorhome. We assumed that we would continue to have mobility rights in Canada and an accessible border with the United States.

Wrong on both counts.

On Friday we move our coach to our site for the next six months. I am looking forward to being at home for the next few months.

As of now, I have no idea where we will be in November. I find that uncertainty to be a tiny bit stressful.