Retiring abroad is a great way to stretch the value of a fixed income. From Latin America to Europe, there are retirement destinations around the world that work for almost anyone. In this article, we'll look at three retirement havens for expats where the U.S. dollar goes a long way and pensioners receive great government benefits.
SEE: Financial Implications Of Retiring Abroad
Retiring Abroad 101
Many people dream of retiring abroad, but get sidetracked by the logistics. From languages to visas to home buying, retiring abroad is certainly not a light decision or an easy process. However, for some people, the benefits of moving can far outweigh the costs. After all, the lower cost of living in some foreign countries can give way to a much higher quality of life.
Those looking to retire abroad should carefully read the State Department's Guide to Retiring Abroad and check with the individual country's embassy for more information. Each country has different rules and regulations that must be followed. Another option is to consult a financial advisor or a lawyer who specializes in international retirement.
Some other great online resources, include:
- Expatistan.com – A cost of living calculator that aggregates price information contributes from thousands of people around the world.
- VisaHQ.com – A resource for all types of visas and related information, as well as contact information for embassies and consulates around the world.
- InternationalLiving.com – One of the oldest magazines focused on living internationally, with a section dedicated to retiring abroad.
Panama: A Familiar Place with Benefits
Panama should seem familiar in many ways to U.S. retirees – the country uses the U.S. dollar and even has the same 911 emergency phone number. Panama also offers a generous retirement visa (visa pensionado) that includes discounts on entertainment, transportation, professional services and medical services, as well as exemptions for importing household goods.
Cost of Living
The cost of living in Panama is well below that of the United States in many categories, especially outside of the capital (Panama City). According to Expatistan, the cost of living in Panama City is approximately 43% cheaper than that of New York City. The most savings are seen in food, housing and entertainment, which are all more than 40% lower.
Usually, you must be 50 years or older to qualify and have a pension that provides at least $1,000 per month in income. However, there are some age exceptions for those with government or high-profile pensions, as well as income exceptions for those purchasing over $100,000 worth of real estate in the country.
Thailand: The Rock Bottom Price
Thailand is one of the most exotic countries on Earth to visit, but few people consider it for retirement. From its beautiful beaches to its diverse culture, retirees aren't likely to be very bored in this country. With a growing number of U.S. citizens retiring in Thailand, it has become a very popular destination for more than just adventurers.
Cost of Living
The cost of living in Thailand is cheaper than the United States, Panama and even Costa Rica. According to Expatisan, the cost of living in Bangkok, Thailand is roughly 49% cheaper than New York City and around 10% cheaper than Panama City, with food and housing being the best areas of cost savings.
In general, you must be 50 years or older to quality and meet some income requirements. You must have THB 800,000 (about $26,000) in your bank account, monthly income of at least THB 65,000 (around $2,120) or a combined bank account and yearly income of THB 800,000 (about $26,000).
Costa Rica: Tropical and Secluded
Costa Rica is the longest-running democracy in Latin America and hasn't endured a civil war since 1948. In fact, the country doesn't even have a standing army and embraces the peaceful motto "pura vida," meaning "pure life." Retirees looking for a relaxing tropical destination to spend their golden years would have a hard time doing better than this paradise.
Cost of Living
The cost of living in San Jose, Costa Rica is about 50% cheaper than New York City, with the most savings being seen in food, housing, transportation and entertainment. Those costs can go down significantly further if you venture outside of the capital city of Costa Rica and into some of the smaller beach communities, like those in Guanacaste.
In general, you must demonstrate a fixed pension or similar retirement income of at least $1,000 per month individually, or $2,500 per month, if bringing a spouse and/or children under the age of 25 years. The latter income can be derived from investment sources that aren't necessarily retirement income.
The Bottom Line
From exotic Thailand to the more familiar Panama, there are many different retirement destinations for people looking to stretch their fixed income. Those seeking more information should consult the individual country's embassy or talk to a financial advisor or lawyer specializing in retirement abroad.