Do you have less money saved for retirement than you’d hoped? Is your pension or Social Security check too small for you to live out your retirement years comfortably in the United States? Or maybe you have saved enough, but want to do something more exotic than strolling the back nine in your newfound free time.
In Ecuador, your money will stretch further – perhaps even allowing you to afford things that would be considered luxuries in the United States – and you can spend your days strolling cobblestone streets while admiring Spanish colonial churches and views of the Andes. If you can handle the inconveniences, cultural differences and potential dangers of living in a developing country, Ecuador might be an ideal retirement destination for you. Here’s an overview of what you need to know about retiring there.
Why Retirees Love Ecuador
Ecuador is a small country, similar in size to Arizona, located on the northwest coast of South America. It has a slower pace of life than the United States, which you can enjoy while relaxing on its Pacific coast beaches, hiking in the Andes mountains and valleys, or exploring the Amazon rainforests and Galapagos Islands.
Year-round, residents enjoy 12 hours of daylight and 12 hours of darkness because of the country’s location on the equator.
Seniors 65 and older, including foreigners, enjoy numerous discounts in Ecuador. They get 50% off on public transit, airfare, electricity, water, phone service, and cultural and sporting event tickets. They’re also eligible for refunds of a significant portion of the 12% sales tax. U.S. expat retirees won’t have to pay Ecuadorian taxes on Social Security income, and property taxes are low and often discounted for those 65 and older. Ecuador’s official currency is the U.S. dollar so American expats don’t even have to worry about fluctuating exchange rates.
Mild climates mean low heating and cooling costs, and you can buy organic produce for a fraction of what you’d pay for conventional produce in the United States. In general, prices are so much lower that you’ll probably be able to afford to hire a maid; you may even be able to afford a vacation home in addition to your primary residence. Depending on whom you ask, the cost of living in Ecuador might be $12,000, $18,000 or $24,000 per year. Any of these prices are a steal compared with living in the United States or Western Europe.
Obtaining residency can be a frustrating and bureaucratic process, a problem certainly not unique to Ecuador. You should research and prepare carefully before moving, then take the remaining steps immediately upon arriving in Ecuador to make sure you meet all the deadlines.
To obtain permanent resident status, retirees often apply for a pensioner visa. As of 2017, rules state that you’ll need to show a minimum income of at least $800 per month from a stable source to obtain a pensioner 9-I visa, (plus $100 per month for each dependent) or if you plan to live off an annuity or trust, the equivalent of five years worth of the monthly minimum, or at least $48,000. Another option is to invest $25,000 in local real estate, such as a home you’ll live in, or in a bank CD or other approved financial instrument to get a pensioner 9-II visa. (For a description of other kinds of less common visas available, see International Living's list here.)
You’ll also need a police report from your home country and, if you’re married, a copy of your marriage certificate. Your visa application documents must be authenticated by the U.S. Secretary of State, then translated into Spanish after you get to Ecuador.
You can always pay for private health care, but if you become a legal resident of Ecuador, you can take advantage of public health insurance. The government allows people to join regardless of age or health, and recently streamlined the process by making it possible to sign up online. As of summer 2017, premiums are just $66 a month for the first person and an additional $13 to extend coverage to the person's spouse. For that low, low price, you’ll get free doctor’s visits, free emergency care and free or less expensive prescriptions.
The country has been upgrading and expanding its healthcare system in recent years, but supply hasn’t quite caught up with the increased demand under the new system so you might experience waiting lists or shortages. In addition, because Ecuador is a developing country, you can’t expect access to high quality or lifesaving healthcare in every part of the country. Bigger cities tend to have better options. What's more, if you aren't fluent in Spanish, you could have trouble communicating your needs.
The big cities have numerous hospitals, specialists and U.S. trained doctors. If you don’t participate in the government system, you can purchase private health insurance if you qualify. Outside the public system, healthcare can cost 10% to 25% of what you’d pay in the United States, and medications can cost as little as 30% to 40% of what you’d pay in the United States. You can also hire someone to live with you 24/7 if you need extensive care.
Places to Live
Numerous cities and towns across Ecuador have become havens for expats. Here are a few popular options.
Cuenca. Ecuador’s third-largest city and a UNESCO World Heritage Site, Cuenca is the country’s most popular expat destination. Its American expat population is around 8,000 and its international expat population is around 12,000, according to a 2016 report from the Ministry of Foreign Affairs; the city’s overall population was nearly 350,000 as of 2017. You can mostly get by in Cuenca without knowing Spanish, or learn it at one of the many language schools, but your experience will certainly be simpler and richer if you can communicate with the locals.
The city sits at 8,400 feet above sea level. Living at such a high altitude may help you lose weight, but increases your chance of developing skin cancer and can cause problems if you have high blood pressure or heart disease. You also might experience flu-like altitude sickness until you get used to the change. Year-round, high temperatures are typically in the high 60s and lows are in the high 40s, but the temperature can vary significantly within the same day, and annual rainfall is about 28 inches.
Cuenca arguably has the best infrastructure in Ecuador, as well as 18 hospitals, a large shopping mall and four international universities. In addition, its location is convenient when you want to hop on a plane, thanks to Cuenca's Mariscal La Mar International Airport.
San Diego native Susan Schenck moved to Cuenca in 2010. “Cuenca is the best city for being an expat,” she says, because it is safe and filled with culture, has an ideal climate and the expat community is so active that for the most part, she feels like she’s in the 51st state of the United States. It costs her less than $800 a month total to live there, including rent and expenses – that’s less than $10,000 per year – which means she has part of her pension left over to travel. You don’t need a car because it’s a walking city, but you can take a bus for just 25 cents, and cabs are $2 to $3. She adds that the city’s walkability helps people lose weight fast. However, her costs may be lower than some, with several sources putting the cost of a furnished rental at anywhere from $625 to $1500 a month. It all depends on what kind of location and amenities you want, of course. If you want to buy, a desirable property typically costs $50,000 to $150,000.
For more information, GringosAbroad.com, a website published by Canadian expats Bryan and Dena Haines, is an excellent resource for anyone considering moving to Ecuador in general and Cuenca in particular.
Quito. With a population of nearly 2.7 million (according to 2014 statistics), Quito is the country’s capital and second-largest city after Guayaquil. In Quito, you’ll find all the entertainment and culture you’d expect from a major city: concerts, nightclubs, theaters, shopping and museums. Quito is situated at 9,350 feet. It has highs in the mid-70s and lows in the mid-40s year round, with dry summers and wet winters. You can buy a place for as little as $50,000 or so, or rent an apartment for as little as $500 a month.
Because of its large size, expats may have an easier time finding the comforts of home here. When you want a small-town escape, you can find one 60 to 90 minutes outside the city. And if you want easy access to the United States, you’ll be glad to know that it’s just a four-hour direct flight from Quito to Miami. You can also fly directly to Atlanta, Houston and New York.
Some people criticize Quito as being crowded, dangerous and dirty, but others say it depends on what part of the city you’re in. Large American cities are the same way. Quito’s revitalized old town area, with its colonial buildings and churches, is a UNESCO World Heritage site, and the city’s massive urban park, Parque Metropolitano, is roughly 17 times the size of New York City’s Central Park. If healthcare is a particular concern, you should know that Quito has one of the country’s best hospitals.
Loja. Known for its music scene, Loja is a city of about 200,000 in southern Ecuador. Though lesser known, it does have a small expat community. The weather is comfortable year round, and Loja is said to have less crime than the bigger cities. Like Cuenca, it’s a walking city where you won’t need a car and can take a cheap cab when necessary, and you can get out of town by bus. Loja, too, is at a high elevation – 6,750 feet – and like other Ecuadorian cities, has no shortage of Spanish colonial architecture, and your cost of living can be exceptionally low, at perhaps around $1,000 per month, including rent.
If none of these three options sounds right for you, they aren’t your only choices. Look into the coastal vacation town of Bahia de Caraquez or the small towns of Vilcabamba and Cotacachi.
The Realities of Life in a Developing Nation
While many sources paint a rosy picture of retirement in Ecuador – and they aren’t necessarily wrong – those considering a move to the country should fully understand its political and economic climate. Political instability, corruption, bribery and expropriation are still problematic. Government debt is low, in contrast to the United States, but Ecuador defaulted on its debt in 2008.
It’s a developing country, so you’ll deal with pollution, pickpockets and underdeveloped infrastructure. You may require medication to avoid getting infected by amoebas and parasites and need to take extra precautions with drinking water, such as boiling, filtering or drinking bottled water.
You also may need to be more careful than you’re used to being in order to avoid crime and getting ripped off. Whatever you would do to protect yourself in the U.S., do it even more. For example, those who want to buy real estate in Ecuador should be sure to do a title search and, if they’re building, purchase from a reputable company, Schenck says.
Ecuador’s highly praised slower pace of life can sometimes come across as laziness or indifference to Americans. “A ‘type A’ person who wants everything to be done quickly and perfectly would be stressed here, unless he or she learns to relax,” Schenck says. “Customer service is not what we from the U.S. or Europe are used to. But you learn to flow with it.”
When doing your research on whether to move to Ecuador, seek out the negative reports as well as the positive ones to get a more complete picture of the new life you’re considering. A good source of information from an American who knows Ecuador well is the book “100 Points to Consider Before Moving or Retiring in Ecuador” by Nicholas Crowder.
The Bottom Line
Ecuador offers retirees a scenic backdrop, low cost of living and beautiful weather. It also has English-speaking expat communities, World Heritage sites, Amazon rainforests and miles of beaches. If you’re not on a tight budget, you can upgrade your lifestyle; if you are, you can stretch your dollars much further.
To enjoy retiring in Ecuador, you’ll need to have patience and a sense of adventure to overcome the culture shock and frustrations that can accompany life in a different and developing nation where you perhaps don’t speak the language. But plenty of American expats will attest that retiring in Ecuador is one of the best decisions they’ve ever made.