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Hello and welcome to Money Girl’s Quick and Dirty Tips for a Richer Life.
Today’s topic: Retire abroad.
Have you ever fantasized about retiring to a white-sand, palm tree-strewn tropical paradise? Or maybe life in a picturesque hillside village in Italy is more your style. Whether you’re close to retiring or just dreaming about it far off in the future, it’s worth considering where you want to live when you retire. Do you want to stay put? Do you want to move to be near friends or family? Do you want to move to a place with a better climate or somewhere with a lower cost of living?
When you think about your choices for where to live when you retire, there’s no need to limit your options to the country you’re currently in. In fact, there are a lot of reasons to consider retiring abroad.
Living the Good Life
In the U.S., more and more people are heading to other countries when they retire. They’re drawn by adventure, pleasant climates, and lower costs of living that help them make the most of their nest eggs.
Even with a weakening U.S. dollar, it’s possible to live the good life on a modest budget in some countries. Retiring abroad in well-chosen locations can put luxuries like having a maid and a cook within reach. It can also allow you to retire years earlier than what might be possible if you were to stay put.
Some countries provide incentives – like resident visas, tax breaks, and discounts on services – to encourage expat retirees to live there. You can find out more about the rules for and benefits of retiring in a particular country by visiting the website for that country’s consulate.
Is Retiring Abroad for You?
When you consider whether retiring abroad might be for you, think about whether you’d enjoy living in a place with a different culture. If being near friends and family members is important to you, retiring abroad probably isn’t for you. But if your family and friends already live in many different areas, whether you’re in Palm Beach or Panama City may not make a huge difference when you want to visit them – either way you still need to hop on a plane. If the idea of retiring abroad intrigues you, but you think you’d miss your familiar way of life, one option is to live abroad part time. If Austin, Texas and Malta are your preferred stomping grounds, spending half a year in each could allow you to enjoy the best of both worlds and get more from your nest egg.
If retiring abroad is an option that appeals to you, it’s important to do your homework and research locations. How’s the climate? How’s the cost of living? Are homes inexpensive? Is quality health care easily available and affordable? What are the rules for residency? What taxes will you need to pay? How formidable will the language and cultural barriers be for you? Can you count on having an Internet connection and uninterrupted electricity?
Try Before You Buy
It’s a smart idea to try before you buy. Try renting in the country you’re thinking of retiring in for several months and see if it’s for you before you settle or buy a home there.
Popular countries for expat retirees include Mexico, Panama, Italy, Uruguay, Thailand, and Malaysia, as well as many others. Malaysia, for example, has an incentive program called “Malaysia – My Second Home” that allows foreigners who can prove a regular monthly income or who make a fixed deposit in a local bank to obtain an initial ten-year visa and purchase property there.
If life in another country is calling your name, keep in mind that there’s no need to wait until your golden years to move abroad. One relative of mine relocated with his family to Bali many years ago. He works remotely for clients in the United States. The lower cost of living in Indonesia means his family can live in a beautiful villa overlooking rice paddies and have a cook, gardener, and full-time babysitter for their kids.
If I’ve piqued your curiosity about living the good life in other lands, check out the resources for retiring abroad I’ve posted at Quickanddirtytips.com.
Since today’s episode is about life abroad, I’m giving away a copy of 1,000 Places to See Before You Die. And the winner is a listener named Meredith. Meredith was automatically entered in the book giveaway when she sent me an e-mail. Congratulations!
Cha-ching! That's all for now, courtesy of Money Girl, your guide to a richer life.
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As always, everyone’s situation is different, so be sure to consult a tax or financial advisor before making important financial decisions. This podcast is for educational purposes only and is not intended to be a substitute for seeking personalized, professional advice.
Send your questions or comments to money@qdnow.com or call them in to my voicemail line: 877-6-RICHER.
Thanks for listening!
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