Episode 045 – Can You Reach FI in Spain? | ¡Al Fin Libre!

Episode 045 – Can You Reach FI in Spain? | ¡Al Fin Libre!

Hello listeners! Today we interview Jesus, a Spaniard who has lived and worked in the UK reaching financial independence at the age of 33. He now lives in Barcelona and travels around the world. We talk with him about his perspective on FI from his point of view in Spain, the implications and strategies this implies and the advice he can give to other Spaniards on the way.

We also talk about:

  • Investment tax regimes in Spain and UK
  • Pensions
  • Real estate investment
  • Benefits of working in the UK
  • Financial education in Spain
  • The importance of measuring

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Spain, a place to build FI or to retire in?

Jesus has worked as an IT consultant in the UK for most of his professional life: this ensured that he could get better salaries than in his home country, but also exposed him to the FI movement in the first place. In Spain there are many obstacles to a financial independence path, from low wages to cumbersome bureaucracy processes and high taxes, although quality of life is very good. Having said that, it’s possible to pursue the FI goal, but it requires a great effort in terms of discipline and saving strategies.

Starting a business in Spain: pitfalls and advantages

Typically, starting a business in Spain isn’t the easiest and the country scores very poorly in the related rankings. Again, bureaucracy and tax regimes make it very difficult to be an entrepreneur, especially compared to countries like the UK. For this reason, when possible people who want to start businesses move their investment to countries like Estonia. We review with Jesus some options that can be viable for Spanish people.

Putting financial independence to use

In a first phase, Jesus has lived his new FI status travelling around the world for 20 months. Then, he chose Barcelona as his base of operations and has started focusing more on long term projects, be it meditation, learning a new language or starting his own blog, which has become his main interest and focuses on the importance of having the right mindset to reach financial independence.

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2 thoughts on “Episode 045 – Can You Reach FI in Spain? | ¡Al Fin Libre!

  1. Hello guys,
    if you live in Spain and wants to reach FI, pretty much the only way to invest is buying accumulation passive index funds.
    This way you don’t get taxed (which is what happens every year if you get dividends!) at all until you actually sell and that shouldn’t happen until you reach FI.
    Therefore at that time, your capital gains will basically be your only income and get you a lower tax bracket than if you sum the gains up now (i.e. dividends) to your work income (salary or business profits).

    For the details of the banks/funds, I’ve found this extremely helpful post (TLDR; open a BNP PI account and buy Vanguard/Amundi funds):

    (it’s in Spanish!)


  2. Hi mmm, I agree indexed funds probably is the best way to invest in Spain. I started investing in dividends because at that time I was living in the UK and dividends exemptions were very good back them (32k per year exempt of tax). And also because it felt more natural to me and because the sources of information I was following were more focused on that kind of investment. It didn´t work bad, but, probably if I would have to start again I would chose indexed funds as investment strategy. Angel post is the one I suggest to the people asking me for this type of investment in Spain. 100% trustable.

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