#1382 – The Expat Files: Life, Power, and Self-Sufficiency in Latin America

Automatically transcribed from the original recording; names and wording may contain errors.

[00:00] South of the border down Mexico way That's where I fell in love when the stars above came up to play and now as I wonder Hello there all you ex-pad wannabes. I'm Johnny Mueller and you're listening to the expat files living in Latin America The show that tells you just what it's like to live work play and or retire down here in Latin America It's a mix of the good the bad the ugly and the great and it's all right here. So let's get started You know if you're living down here in Latin America, even if you're visiting often times You'll see things you'd never see up in the first world and when you mentioned it to a gringo or expat Who's been living down here? He might say that kind of stuff only happens in Latin America if you're gonna live down here get used to it

[00:48] Then again, if you're in India and you're driving along the road and an elephant Crosses your path gringo or expat living there might say only in India get used to it And you do get used to it I mean so much so that when a fresh green gringo is down visiting you and he or she Stops and says hey, did you see that? He might just say see what? What I mean is things that seemed very strange to you when you first got down here after a while You don't even notice a good example is the fact that there are so many pieces of shit vehicles down here Vehicles that are basically death traps that would never ever be allowed on the road up in the states Well, they're all over the place down here with never a comment or a second thought from the locals

[01:36] However, fresh green gringo is visiting comment about it all the time. Look Johnny. You see that look at that piece of trash, man I wouldn't be caught dead in that thing. I can't believe that shitbox even runs. Don't tell me they allow that kind of stuff down here I don't believe it. My reply as always is if you're gonna live down here get used to it Oh, and here's an interesting observation I made early on about people driving those shit boxes It obviously seems no matter what kind of a russet out death trap a guy might be driving He's proud of it or more precisely He's proud of the fact that he doesn't have to take the chicken bus or public transportation He's got wheels man, and it doesn't matter if they're crooked rusted or ready to fall off He's got wheels. Remember your first car in high school shitbox or not. You had wheels you had freedom

[02:26] Of course, I'm talking about a time Long ago today US teenagers are picky They won't drive a shitbox. No ordinary car will do. Yep. You boomer and Gen X her parents You created little monsters didn't you? That's why it's so funny even oddly gripping when you see a Latino with a real shitbox car Expressing pride and having any kind of vehicle at all down here You see it all the time a guy with a terrible rusted-out wreck is super proud of his wheels you know often for example see a guy with completely rusted-out pickup truck or van a Vehicle where practically every square inch of paint has been scratched or peeled or bowled off Except oddly enough the area on the back trunk or tailgate where the letters for example

[03:11] Nissan or Toyota are stamped into the back panel You know what I'm talking about every Toyota pickup truck for example as the letters Toyota Stamped in the back panel the tailgate that flips down Well, you know down here in Latin America the proud owner of a 25 year old rusted-out Toyota pickup will do he'll buy some black paint and restencil the letters Toyota over the rusted-out Toyota letter logo a Logo that was once long ago fresh and factory stamped in other words when you're driving on the road Then you'll see this complete wrecked piece of shit a virtual death trap beat scratched Rusted-out dented in a hundred different ways except the letters Toyota across the back will be fresh and dark and perfectly visible

[04:00] But this is Latin America so standards are low, you know details details So those newly painted letters that say Nissan or Toyota will be slightly off and slightly squiggly So you can tell right away It was a hack job and you know when I first got down here I thought to myself who would do such a thing What would motivate a guy to highlight the letters Toyota on the back of his truck when practically everything else in that car was a total Wreck why repaint those letters so that the brand Toyota is loud and clear Why bother when the tires are bald the brakes are shot mirrors are gone windshield broken And he probably hasn't changed the oil ever Come to think of it. That's why I guess that phrase only in Latin America pops up so damn frequently

[04:48] Now about this repainting of the Toyota letters thing Prioritizing that over the hundreds of other things that are wrong with the car over the years I've asked quite a few gringles and experts what they thought was happening. What was going on in the mind of a guy who would do that Like me most expats are baffled expats will shrug and say search me Give me a look that signifies that it's one of the mysteries of the universe You know, I've been seeing this thing off and on for 30 plus years now And I'm still waiting for someone to give me a decent explanation Hey, if you've got one, I'm all ears send me an email the expat files at gmail.com All right moving on. Let's talk about Ecuador because Ecuador has been touted as the top US expat retirement destination by Rags like International Living, you know that already right?

[05:36] Yeah, well if you're a long time listener to this show, you know, it's not my number one pick It never was I in fact have said in the past nice place to visit But I wouldn't want to live there though I've been changing my opinion about even visiting there because you may have heard or maybe not the national electricity Company Senase in Ecuador has ordered 10 hour long blackouts every day for at least 15 days In fact, here's the English translation direct from Ecuador's biggest publication biggest rag It says the national electricity operator Sines has ordered 8 a.m. To 6 p.m 15 days effective immediately The object being the director general Javier go Vera said is to allow the restoration of

[06:25] Operational water levels at our reservoir and our three hydroelectric dams The electric company says the suspension of operations at all three downstream power plants is necessary to speed up the reservoir's refill Where under normal conditions the three plants powered by the reservoir provide 40% of Ecuador's electricity They'll be shut off 10 hours a day now for at least the next 15 days energy minister Antonio Conglaves announced Thursday that the country's industrial sector would be asked to share in the sacrifice During the electric crisis blaming the blackouts on the worst drought in Ecuador's history While residential and small business customers have borne the brunt of the blackout so far the burden must now be shared He said urging industries to use private generators whenever possible

[07:14] Alright, so that's what's been happening in Ecuador lately The question is could you handle it 10 hours a day without power for 15 days in a row Gringos and expats down there have been telling me it's a huge pain in the ass They're saying how come no one told me the situation was so precarious before I moved down here Well, I've been saying now for what 12 13 years now. Don't move to Ecuador Nice place to visit but not a good place for your plan B though. I didn't predict the energy problem I mentioned lots of other negatives and let that be a lesson to you You know how I've been talking about getting off the grid having solar power, etcetera, etc Wherever you happen to be in Latin America up in the States for that matter, too I've been advising people to go solar for ages. My big question is why haven't

[08:01] Ecuadorians gone solar like so many other places in Latin America. I read the journals in the regs I never see any ads by companies who install solar never I mean held there directly on the equator the the best place in the world to have solar. It doesn't make any sense That's where the most intense solar radiation is and thus the best-case situation for solar panel efficiency I haven't seen the satellite images almost no one has solar in Ecuador Though in many other places in Latin America like Costa Rica the DR Puerto Rico Panama different parts of Mexico You see all kinds of solar setups on people's roofs. Hell even gas stations You know fossil fuel companies like Texaco and Shell have solar panels installed on their roofs here in Latin America

[08:49] at least some of them do but Ecuador man where they could do the most good seem out of the loop as Does by the way Argentina and I don't understand that at all Oh, and by the way, just two weeks ago President Noboa of Ecuador came out saying that everyone should have a gas generator a portable gas generator somewhere at home Yeah, right. Well, that's okay If you're a gringo or expat because you know a decent small gas generator dependable ones gonna cost four or five hundred bucks Even at Costco the average Latino family in Latin America could never afford such an extravagance The average adult Latino in Latin America does not even own a car But the president said go out and get a generator by the way on top of that He said by decree he's eliminating the 15% VAT tax the value-added tax on gas lean power

[09:38] Generators as of last Thursday that shows you how desperate they are with the power situation What kind of desperate straights they're in? By the way, if you've been to Ecuador in the past month or two You'll see there are small gas generators all over the business districts sitting out front on sidewalks Stinking up walkways and entrances with those putrid exhaust fumes Gringos, I know living down there Tell me that businesses are frantically attempting to keep the lights on and the cash registers Operating and the refrigerator freezers going the only way to do that is with a small generator Speaking of small gas generators, you know me I'm always prepared or try to be I've always had a small gas generator Even years ago when I lived up in the States and there was no need to have one really

[10:25] I just figured it as an insurance policy someday. You might need it or somebody you know my So anyway, I've had a number of different models and the latest model Which I bought about three years ago now is a real marvel a very small portable 2,000 watt job from a company called champion bought it on Amazon. It's just an unbelievable piece of machinery It puts out about 2,000 watts, which is like a 15 amp circuit So it can handle pretty much anything in your house except air conditioning My advice don't get a big generator a four or five or eight thousand watt job. They're noisy They're gas hogs and they're very heavy instead and it's highly recommended get a small super efficient quiet one like mine hell It's only 35 pounds. So even a lady could carry it around But here's the thing like any generator you gotta break it in right or it just won't last

[11:16] Now personally, I believe if you're living in Latin America, you should have one even if you never use it Believe me I've done a lot of research on generators over the years and there are some new models that are fabulous and cheap Send me an email the expat files at gmail.com and I'll send you the link to the one that I have right now Now one of the reasons I'm bringing this up is because of all the hurricanes and stuff that are going on up in the states Don't you guys and gals living in those stricken areas wish you'd have bought one now By the way, the one I'm talking about will run about 10 to 12 hours on a tank of gas tanks about one gallon Now what's different about this particular generator? I bought it's dual use uses gasoline and or propane gas man Is that convenient? That means if you have a big emergency you're out of power for a couple of days

[12:02] You might go through your gas you might only have a 5 or 10 gallon can under those conditions You can't count on the gas stations being open However, if you're prepared like I am you have one or two tanks of propane around the house So with that little champion generator of mine, I can switch right from gas to propane in about 10 seconds No crazy conversions necessary. You just screw on the hose and regulator. That's included with the thing the model I have it's called the champion 2000 dual fuel generator man. I'll tell you it's one of the cheapest insurance policies you'll ever have Again because I was an engineer in a past life. I know a bit about mechanics and electronics I'm gonna give you some tips right now and how to make your gas or diesel or propane generator last a lifetime

[12:48] Tip number one when you break it in, you know, you got to break those things in people don't know that when you buy a new one You put fresh new oil in it, of course But you only run it for about an hour and not at full load after that hour You empty it out and put brand new oil in because with all those newly machined parts, they'll be impurities and tiny metal shards and Solvents and cleaners they've used in the manufacturing process that stuff will get into the oil and if you don't change that oil It'll keep recirculating end up accelerating the wear and tear on your motor So my advice use regular grade oil for that first hour then change it to mobile one Now the generator manual say after that first oil change after an hour

[13:34] The second oil change should last you 15 or 20 hours. I'm telling you with mobile one You can run that thing for a hundred hours without a problem It's just so slippery and does not break down at high temperatures like a regular oil will anyway That's one recommendation. Of course mobile one is four times as expensive as regular oil Which is why almost no one uses it, but you get what you pays for Tip number two go on Amazon and buy a magnetic oil drain plug. I bet you've never heard of one It may be the best ten bucks you ever spent because as mentioned in a new gas or diesel generator The parts are fresh and newly machined There are little shards of metal that will flake off during the first hour of use and those tiny shards will recycle through your motor

[14:19] And make microscopic scratches in your pistons valves, etc Effectively reducing the life of your motor, but if you've got a magnetic oil plug It'll attract those little metal shards and I'll collect on that thing And when you do that second oil change after an hour you wipe it down clean it off and you're good to go By the way, you can prove it to yourself when you do that second oil change Just pull that plug out and have a close look at it You'll see it's collected tiny little shards of metal By the way small generator motors like that do not have oil filters That's why you go through the steps previously mentioned would be nice if they had an oil filter, but they don't Of course gas diesel and propane generators are dirty smelly and noisy and not a permanent answer to power outages

[15:04] That's why I'm such a huge proponent of solar panels I believe every expat should have in his top 10 priority list the active desire to get off the grid and go energy-independent It's just gotten so cheap to do so and though it sounds like such a great idea They've been perfected and cheap too People are still gun-shy not so much up in the States, but they sure are down here in Latin America Biggest complaint is people don't want to get stuck with a system That's an orphan, you know a company that won't be around anymore five or ten years later when you need parts I say don't worry about it because in five or ten years things will be much more Miniaturized lighter and cheaper besides that every three to five years is a great leap forward in solar design Look at Tesla. For example, if you need a new inverter and five years ago, it cost thirty five hundred bucks five years from now

[15:55] It'll cost a grand and be much more efficient smaller lighter and better looking Personally, I've been working with solar a long long time. And the biggest problem I see is finding a place to put your solar panels If you've got too much shade, no Sun They won't work and if you live on the third floor of a seven-story high-rise Your SOL there'll be no place to put the panels But not to worry your Fred as one gringle buddy of mine pointed out He lives on the fifth floor of a ten-story high-rise a residential tower as he did a walkthrough to inspect the place He asked the realtor if they could go up and inspect the roof By the way, most all residential towers have flat concrete roofs So he in the realtor made their way up to the roof

[16:41] It was a completely vacant flat expanse of concrete with the industrial sized tubes sticking out of it here and there There were a few old unused obsolete satellite dishes up there, too That no one bothered to dis install bottom line lots of junk on the roof, but mostly empty space Anyway, my gringle buddy said to the realtor Is it possible that I could use some of this space up here to put a couple of solar panels? The realtor thought for a second. No one had ever asked him that question. He said I don't see why not. I'll check how much space do you need now? He estimated that the total flat roof area was around 200 square meters about 2,000 square feet and My gringle buddy said well, what about 20 meters 20 square meters, which is 200 square feet enough for 20 standard-sized solar panels

[17:32] Then the realtor said 10% of the roof area. It seems reasonable. I don't see why not I'll ask the junta directiva now when you hear the phrase junta directiva That'd be the condo or the building association Anyway, in the end the realtor sent out emails to the junta directiva. He said there were seven people on the board They all agreed that because the roof wasn't being used He could use 20 square meters as he asked for but they wanted $20 a month rent and for him to sign a little contract that said if he caused any damage up there You know, there was a leak or who knows what he would be responsible for it So in the end my gringle buddy got completely energy self-sufficient. He installed or I should say he had a company installed

[18:18] 2,500 watt solar panels. That's 10,000 watts of power he became the only guy in the whole building. I think there was something like 40 apartments in that residential tower He became the first and only guy in that tower to become completely energy self-sufficient Yep, the rest of the tenants were jealous, but that's the way it goes It's the gringo advantage in action just being a gringo gives you an advantage Remember when he asked the Latino realtor if he could go up on the roof and have a look the realtor said sure But no one had ever asked him to do that before that in itself says a lot By the way, I do get occasional emails from younger guys and gals up in the states who don't have a big nest egg They say Johnny How much do I need to come down to Latin America and make it?

[19:03] Well, I don't know what they mean by make it depends on your lifestyle and all that I mean look the other day I got an email from a 38 year old Gringa living up in Canada. She said Johnny. I Just can't do it anymore. I can't live in Canada. It's intolerable I've only got 25,000 in savings though 25,000 Canadian, which is what about 20 K US She's wondering how long it might take her to get a decent paying job in Latin America She's thinking specifically Salvador or Guatemala. She's got an English degree and she has a master's in education Well, unfortunately, you know here in Latin America if you're gonna work for the man Work for a company work for the government. Whatever You will be paid by Latin American salary standards, which can be pretty disappointing

[19:51] Take me for example between the year 2000 and 2008 I worked as a morning in drive-by guy a couple of Latin American radio stations big stations important stations In fact, I was told by the owner of the station that I was the highest paid radio guy in Central America I made a thousand dollars a month. Yeah, a thousand bucks a month. Don't laugh I hear you snickering and get this back then even now that's a huge paycheck for the average Latin American That's upper middle class Even back then the year 2000 to 2008 that was three or four times the minimum wage meanwhile up in the States my Radio counterparts working in Chicago or Cleveland or Miami or whatever They were making at least five times that five grand a month or more

[20:38] So I'm telling you that's what you can expect if you're gonna work for the man here in Latin America It wouldn't be far fetched at all to estimate that you'd earn about a fifth of what you'd make for the very same job up In the States, so I told Cynthia the Canadian teacher who said she can't take it anymore. She's got to get away I said if you think you're underpaid and underappreciated up in the Canadian school system We get down here to Latin America and make a fifth of what you were making up there She didn't want to hear that but then I explained I told her what I tell everyone else It's easy to live down here on $1,500 a month 2,000 a month you're leaving really good now if you really want to stretch it out You probably could live easily on a thousand bucks a month if you don't go out to the bars and don't go drinking You know you kind of watch your nickels and pesos, but you won't suffer for it So I told Cynthia she's got a nest egg of around

[21:26] 20,000 US dollars she could figure that'll last her 20 months That's if she came down and did not work at all, but she wants to work She has to eventually work because 20k won't last you forever and with her teaching background and education Masters, she'll certainly get a job teaching English in a private school Or maybe at an English Academy working for the man They'll probably start her out at six seven or if she's lucky 800 bucks a month sure you can live on that But it's just a step above backpacker style The whole idea though is to do what so many expats have done like expat Eddie did forget working for the man Be your own boss So then how do you do that well the only way to get started is to come down here get some boots on the ground Might take you a month or two or more to get the ideas gelling in your head

[22:13] But they will come the fact is most any gringo or gringo can do well in Latin America do very well, too It doesn't matter how low on the totem pole you were when you live back in the States It's more about your own drive and ambition than anything take expat Eddie. You've heard me talk about him before He had no support at home as a kid no guidance from his parents or grandparents He was one of those ragtag kids who grew up in a trailer park when you'd ask about his parents He used to say his father was a part-time worker and a full-time drinker and his mother a full-time worker and part-time drinker So he definitely had no role models or guidance as a kid you longtime listeners heard me Tell the story that when he first came down. It was about Ten years after I came down he slept on my couch was supposed to be for a week or two turned into well

[23:04] I won't tell you how long it turned into But he did come down with 5,000 bucks and it's worth maybe five million now found his niche in the restaurant business Open a tiny little sushi kiosk in one of the only big modern malls in San Salvador the capital of El Salvador He stumbled into it in a funny way He likes sushi a lot, but couldn't find any to his liking at the time There were no restaurants in El Salvador that served strictly sushi Just a lot of bad mediocre Chinese restaurants that had a few stale and mushy sushi dishes on the menu He tried them all and they were all done badly Surprising since a huge portion of El Salvador's land borders the Pacific Ocean The country had all kinds of fresh seafood in abundance

[23:52] But no dedicated sushi restaurants and Eddie hadn't even put much thought into the marketing of the place He just wanted to have good sushi for himself He figured there'd be enough gringos trickling in and out of the country to have some customers though He never imagined the vast majority of his future clients would be upscale Latino gringo wannabes So he rented a tiny little kiosk for I think it was a hundred twenty five bucks a month in An upscale mall and just him being there a gringo started drawing customers That's where he first learned that upscale Latinos love everything gringo and gringo related So again, the lesson there is if you're coming down to Latin America and you need to work You haven't got a big nest egg or maybe you have a big nest egg, but you still want to work

[24:38] Just remember even if you're a professional The pay down here if you're coming down here with the idea that you want to work for the man That is you're not your own boss. You probably won't make enough to pay for a first-world lifestyle You'll have to cut some corners because it's unlikely you'll make even a thousand bucks a month However, if when you come down here you end up starting your own business, whatever it is. This guy's the limit It really is now some of you might be thinking Johnny Why would you take a job at a radio station that pays only a thousand bucks a month people have asked me that well You know Yeah Gotta stay busy and I had a pretty good nest egg when I came down and you know a job like that is Quite fun and you have to remember who my sponsors were Gold's Jim Hooters Harley Davidson and Heineken The real ace in the hole though. The real incentive was the fact that I only worked two hours a day

[25:28] For four years. I was the morning mouth from 7 to 9 a.m And the next four years I was a drive by a guy the Chi-town Johnny DUI show driving under the influence of me Johnny 4 p.m. To 6 p.m. Weekdays. I know a thousand bucks a month is jump change by US standards But I only worked 10 hours a week did my two hours each day and left, you know It's good to have things to do. You have to occupy your time. Once you get down here You're gonna have lots of free time on your hands, especially if you're a first-world motivated go-getter type at first when you come down You'll be busy get yourself settled get an apartment find your way around etc. Etc Then what you just gonna coffee clutch with the gringos all morning and go to the gringo bars every night Nope, not for me. The key to the good life down here is to have fun and exciting things to do

[26:19] That's why so many expat gringos end up creating their own businesses be in their own bosses Not necessarily brick-and-mortar businesses either I'd say about three-quarters of all gringos who start businesses down here have them exclusively online Of course, there's lots of advantages to that. No driving. No fighting traffic looking for parking places, etc. Etc No office rent because with an online business you can usually do it from home. That means practically no overhead That means in many cases complete tax avoidance if you so choose Alright, we're getting towards the end of the show and before we close I want to tell you what one of my Latino buddies said to me the other day made me laugh He's a guy whose greatest dream is to live in the states like so many Latinos So he's studying English and studying gringos, too

[27:06] He's got a few American friends down here and he's learning American ways by studying us. He says So the other day he said to me Johnny. I finally get what American gringos mean when they talk about monogamy. I Said monogamy. What do you mean? He says well for Americans American guys that is monogamy is The custom of having one wife and hardly any mistresses You've been listening to the expat files living in Latin America If you need some help with your own plan B We can schedule a one-on-one phone or Skype consult Just send me an email the expat files at gmail.com And if you want to get on the waiting list for my next week-long expat insider seminar in Central America Where you're guaranteed to get a two to five year head start on your plan B

[27:54] Send me an email the expat files at gmail.com. No spamos