If you didn't save enough for retirement, you're far from alone. According to GOBankingRate's 2018 Retirement Savings survey, 42% of Americans have less than $10,000 saved for retirement, while 14% have nothing saved. These figures take into account all age ranges, but what's even more alarming is that about one-third of those age 55 and older have less than $10,000 saved, with more than 10% reporting having nothing saved.
Where Can You Live Well on Social Security?
With pensions few and far between these days, many will have to rely heavily on Social Security benefits in retirement. However, the average monthly Social Security benefit in 2018 is $1,404, which amounts to just $16,848 for the year. And, according to the Bureau of Labor Statistics, in 2017, the average American age 65 and older had annual expenditures of $49,542.
Let's face it, there are likely few places in the United States where you’d be happy living on $1,400 a month, and if you're running short on additional savings, you may want to start considering some alternatives – outside of the United States. Retirees who do often find they can afford a very nice place to live, a maid, a gardener and meals out, surrounded by beautiful weather, on their income from Social Security.
Consider Latin America
Latin American countries, which may be close enough to have the grandkids visit from the States, include Mexico, Ecuador, Panama, Colombia, Nicaragua and Costa Rica. International Living magazine, whose tagline is "Live better – for less – overseas," names Costa Rica, Mexico and Panama as the top three on its list of The World’s Best Places to Retire in 2018. And Tim Leffel's Cheapest Destinations Blog has a helpful list, with pros and cons for many countries laid out.
You can visit a site like Numbeo to get an idea of the cost of everyday life in a country, and there may be some additional perks. For instance, retirees who gain residency in Panama can participate in the government's Pensionado program, which will afford them all sorts of deals. Those with retirement income of at least $1,000 a month can get a 25% discount on utility bills, 50% off recreation and entertainment activities, 30% off inter-city buses and trains, 25% off flights, 30%-50% off the rack rate of hotels (depending on the day of the week), 25% off sit-down restaurants, 15% to 20% off medical costs and a 10% discount for prescription medicines. (For more, see: Living in Panama on $1,000 a Month.)
Expats Abound in Southeast Asia
Asia has a number of countries on the verge of being discovered by the retirement masses, but there are already friendly communities of people from the U.S. and other western countries. Those countries include Vietnam, Thailand and Malaysia. You can find many blogs written by expats to get the flavor of life in each country, as well as the costs. (For more, see Find the Top Retirement Cities in Vietnam and What It's Like Retiring in Tropical Malaysia.)
And don't overlook Cambodia. Leffel designated it his top overall choice in Asia, noting that, "besides low prices, it is one of the easiest places in the world to stay put for a while as a foreigner. You can buy a business visa for a few hundred bucks that is good for an entire year. With that you can work, start a business, or just be left alone. As long as you stay within the law, you can keep renewing it after that, making this one of the cheapest countries to live and work legally."
The Bottom Line
Living in the United States can be expensive when your only income is Social Security. Unless you’ve put aside a tidy sum to supplement your retirement income, you might not see your later years as all that golden. But it’s a big world out there, and Social Security benefits can provide a beautiful life for you out in that world. The U.S. government will deposit your checks every month in a bank of your choice, and many less expensive countries will welcome you and provide ATMs, among many other services, for your convenience.
Be sure to do your research first though, and it's a good idea to visit any place you plan on living before you move there.