Thousands of people retire overseas every year. They leave for countries where living expenses cost less, healthcare is cheaper and their retirement savings allow them to have a better lifestyle. Before heading off for parts unknown, there are nine basic issues retirees should address.
Tax Rates
A primary reason retirees are flocking overseas is lower taxes. In the U.S., taxes represent a considerable expense that can quickly deplete savings. The tax rates in some countries are low, making them an attractive place to retire, but there may be hidden costs that aren’t immediately apparent, such as immigration fees. Some taxes may be less in a foreign country, but others may be higher than expected resulting in a trade off where retirees are essentially paying the same amount.
Monthly Income
Those retiring to most foreign environments can continue to receive Social Security checks and other income. Funds can be deposited in U.S.-based accounts or in foreign bank accounts via international deposits. Before retiring to another country, retirees need to explore banking regulations to ensure uninterrupted receipt of their monthly income sources. Countries that include Cuba, Vietnam and portions of the former Soviet Union donft allow Social Security benefits to be collected by foreign retirees.
Healthcare Coverage
A major expense for retirees in the U.S. is healthcare, from office visits and medications to tests and medical procedures. Many countries, such as the UK, have national healthcare systems to ensure medical services are provided to all, but those with medical needs may face long waiting lists to receive care and it may only be available to citizens. Those with private health insurance often discover their coverage isn’t accepted in some countries and the scope of Medicare coverage ends at the borders of the U.S.
Other countries, including Thailand, have elevated medical coverage to the level of a luxury vacation. The cost of medical treatments is less than comparable services in the U.S. and includes additional services that rival top rated spas. Rules governing medication also varies widely by location. Some tightly regulated medications in the U.S. can be purchased as over the counter remedies in other countries.
Housing – Rent, Buy or Lease
Rental and lease agreements allow retirees to relocate if they desire while eliminating the cost of maintenance and upkeep. Some countries, such as Mexico, won’t allow anyone to own real estate if they weren’t born in the country. Retirees can live in some Central and South American countries on $20 per day and rent in France can be as little as $500 per month.
American enclaves specifically designed and developed to offer all the comforts of home, along with a variety of luxury services are also offered. Retirees should thoroughly investigate property laws within their chosen country. For a unique experience, and a virtually tax-free retirement, invest in a houseboat.
Speaking the Language
English is one of the most spoken languages in the world, but those retiring to countries where English isn’t the primary language shouldn’t assume they will be accommodated. Retirees who don’t speak the native tongue should consider foreign language lessons, reconsider their retirement destination, or select an enclave that caters to English speakers.
Transportation
Retiring to some countries means living without a personal vehicle, as desired locations are within easy walking distance. Other countries offer extensive and inexpensive public transportation systems and taxi services. In countries such as China, a special permit is required to own a car and the waiting list is long. Bicycles, mopeds and motorized bikes are a preferred mode of transportation in many countries and can easily be adopted by retirees.
Climate Change
Those seeking a warm, exotic location in which to retire should research the weather of their destination carefully. An average median temperature of 70 degrees Fahrenheit doesn’t mean temps won’t decrease or exceed that number. Humidity, local rain amounts and regular weather “seasons” will affect local temperatures and might even have a detrimental effect on health.
Communications
Maintaining contact with friends and family members is vital, but services for cell phones, mobile devices and Internet access may be lacking, completely unavailable or even monitored. Retirees will want to choose a destination where free speech is allowed and all modern communication methods can be accessed.
Immigration Incentives
Retirees can live overseas for many years as perpetual tourists and some countries, such as Belize, have instituted incentive programs to entice retirees to their shores, along with the income they bring to the economy. Minimum monthly income requirements may apply, but some countries allow retirees to import all their household goods tax free, including vehicles, watercraft and a variety of personal aircraft.
Retiring abroad can dramatically reduce the cost of living and improve the quality of life experienced by retirees. It also requires a change in perspective and extensive research. Retirees have generally spent their entire life sacrificing and going without many of life’s pleasures to own a home and save for retirement. Taxes, housing and medical coverage overseas can be much less, allowing retirees to enjoy dining out, movies, theater performances and many other entertainments they couldn’t afford while living in the U.S.
