When we moved to Costa Rica in early 2009, the United States economy was in the throes of economic upheaval. The late 2008 stock market debacle and the subsequent bailouts were impacting on the middle class's investment portfolios and retirement security. The average person who put their trust in their corporate retirement plan and 401 K's were suddenly aware how vulnerable they were to the whims of the global economy.
My husband retired in 2008 at the age of 51, with 30 years of service to local government. His annuity was coming from a fairly stable source, since it was state government that was writing the checks, so we weren't too worried. Then while we were living on the farm in the mountains of Costa Rica, we started hearing about state and local governments going bankrupt. The security of our retirement check became less certain. We weren't at all prepared for the possibility of losing our retirement check. Fortunately, we have to this point in January 2011, not had any issue with NC State government sending us our check, but it did cause us to look seriously at our contingency plans.
I am not going to talk about our income contingency plans here, but the whole idea of economic uncertainty does bring to mind some things that I would like to talk about. Our life choices have always revolved around sustainability and self reliance. We chose to live as close to nature as we could, to grow our food and gain knowledge and experience in as many aspects of homesteading as we could on our little piece of land. We lived frugally on one income, drove older "beater" cars, and had the long term goal of being debt free. When we moved to Costa Rica we added to our experience tool set by learning from the Ticos, how they manage to live good full lives on very little income.
I was constantly amazed by "Ticonomics". Costa Rica has a large middle class, has an 85% literacy rate, and is one of the cleanest, "greenest" places I have had experience with. Of course, "middle class" and "literacy" are relative. A middle class Tico does not live like a middle class American, with two cars (or more), a house with a 30 year mortgage and disposable income to toss around on eating out and movies. Literacy doesn't mean you graduated high school, it means you can read, write and do functional math and have an 8th grade education. A middle class Tico has a small house of 600 to 1000 sq. ft. with no mortgage, no car for most families (in our area in the mountains anyway...), and has very little disposable income.
The thing that is so amazing is that Ticos know how to sway with the economic winds. If the US economy is bad and tourism is down, there are fewer jobs available. When this happens, Ticos switch from a paying job to odd jobs and working the land to grow their food. When income is limited they cut back on things, use less electricity, stop using their cell phones (there are no 2 yr. phone plans in CR. you pay as you go), eat more basic foods and everyone pitches in to bring in what is needed to pay the bills. One of our friends has a family of 5 at home with the possibility of 4 other family members having to move in during hard times. The man of the house is a strong, hard working foreman for a construction crew. When he has work, he puts away for the thinner times when there is no construction work. When the job is over, while he waits for the next project to come up, he raises chickens for meat and sells them to "Gringos" and to businesses in town. He raises an amazing amount of food in very little space, has a calf tethered in the yard to cut the grass and grow out for meat, and milks an American's dairy cows for some cash and milk to bring home to his family. Their monthly income is often less than $300, but they are happy, busy, fed and have time to spend with friends and family.
I think the secret is that they are content to live simply. Meals are very simple, consisting of fresh fruits and vegetables in abundance, rice and black beans. Their homes are scrupulously clean and simply furnished. They expand their living space by building a deep veranda (covered porch) on their house where they spend most of their time. They go to bed shortly after dark and get up with the rooster. They can live on practically nothing.
The Tico is able to build a house with cash for the most part since they are not extensive structures and they keep utilities to a minimum. Living in the tropics where there is no need for central heat and good insulation means that the Tico doesn't have to have the same kind of investment in their house construction materials. A small house with one bathroom, tiny bedrooms and a kitchen is sufficient. The veranda is the living area where family and friends gather to chat, eat, and catch the evening breeze.
The plaza is another extension of living space for social interaction. The plaza is the heart of the community, it is usually a soccer field that has benches and trees surrounding it. Everyone ends up there at one time or another, to talk about the day, catch up on news and let the kiddies run and play. There is always some kind of activity going on, an impromtu soccer match, teens walking in clusters laughing and whispering to each other, the elderly sit in their plastic chairs and watch the grandkids while parents have a few minutes of social time before bed. Life is lived as a village, not as isolated cells of immediate family as it is here in the States. Americans could benefit emotionally, financially and socially from adopting a few of the basic tenants of Tico life. If we were less isolated, spent more time doing things outside, and were happy with simple pleasures, there would be less need to spend money and time going out.
I really didn't mean to go on about Tico life, but I learned so much by having them as neighbors and friends, that it is hard not to wax philosophical about their way of life. What I really want to talk about is learning to sway, "Tico style", to the present economic winds. So in the next several blog posts I will be talking about what our family has learned about being economically flexible.