Can You Retire in India with $200,000 in Savings?
An American dollar can go quite far in South Asia. How far? A cost of living comparison of 125 nations worldwide finds India ranked number 125 with a consumer price index (CPI) of 24.85. For comparison, Switzerland ranked first with a CPI of 124.51.
Similarly, when the price of a McDonald’s combo meal is used as a benchmark, India ranks number 113 among 119 countries.The Indian price of $3.05* falls much closer to the lowest price of $2.56 (Philippines) than the highest price of $13.39 (Switzerland).
How Much Money Do You Need To Retire In India? specifically addresses how manageable average monthly expenses in India would be for most American retirees. Retirement savings of $200,000 will go much further in India than in most of the world's countries (not to mention the United States).
What’s more, India remains poised for economic growth. One analyst described this phenomenon by stating “the emerging-market scene will have a new favored son” over the next two years. (For context, read The Healthiest Emerging Markets in 2015.)
Here’s a breakdown of key factors that affect basic purchasing decisions for those considering retiring in India.
Housing: Rent or Buy?
Housing expenses can vary considerably throughout India (see Bargain Cities to Retire to in India), but still remain a value for Americans living on pensions and savings. As for renting versus buying, renting may be the only viable alternative for some foreigners.The Indian government has placed limits on foreign ownership and control that vary by industry, as well as geographical sectors within the country.
In fact, the U.S. Department of State is rather blunt in its assessment of India’s travel policies: “Indian visa regulations change frequently, often with little advance notice, and changes may be poorly advertised and inconsistently enforced.” Indeed, it makes sense to clarify such issues before committing to retirement in India.
Getting Around: Car or Taxi?
The “Driving Abroad” page on the U.S. Department of State site provides advice on global driving rules and purchasing auto insurance overseas. An International Driving Permit (IDP) is valid in India, and good for one year.
That said, driving in India is quite dangerous: The nation leads the world in traffic fatalities. As the State Department advises, non-Indians may want to seriously consider hiring a local driver. That may sound like an expensive proposition, and in some countries it would be. But according to the cost-of-living site Numbeo, taxi costs in India average about 35.00 Indian rupees (INR) (approximately 53 cents) for the first mile and 24.14 INR (37 cents) for each additional mile.]
Healthcare: Tough Decisions
According to the World Health Organization, “Medical Tourism” has been thriving in India in recent years. But while healthcare costs are much lower in India than in the United States, Americans should be aware of this assessment from the U.S. State Department: “The quality of medical care in India varies considerably. Medical care in the major population centers approaches and occasionally meets Western standards, but adequate medical care is usually very limited or unavailable in rural areas.” (For a discussion of medical tourism, read Where Can Americans Go for Cheaper Healthcare?)
Investments: An Option for Some
Some Americans may qualify as NRIs – nonresident Indians – who are citizens of India or persons of Indian origin who are not residents of India. Consider that NRIs are awarded certain financial privileges, including:
• Maintaining both NRI and foreign currency accounts in Indian banks;
• Investing in immovable commercial properties in India without any limits;
• Investing in government and Unit Trust (UT) of India bonds, debentures, shares, and securities.
The Bottom Line
For Americans looking to retire, India is not the easiest country to select. Immigration regulations vary considerably for those who are not related to Indian citizens by birth or marriage. (For further explanation, see How Much Money Do You Need To Retire In India?) Additional hurdles may hamper plans to work, drive and invest in India.
That said, it is a country where a financial stake of $200,000 would facilitate a very comfortable existence.
* All currency conversions calculated through XE Currency Converter, effective November 6, 2015. These rates fluctuate daily.