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By Alissa Green
Heading toward retirement but worried about how to afford it? You may have an easier financial time of it by choosing to retire outside of the United States, where your savings can go further.
Retiring abroad can mean better weather year-round and the start of a new chapter filled with breathtaking sunsets and toucan-filled mornings. But it can also mean being farther away from friends and family in your twilight years and having to adjust to a completely different culture and language.
Still, many retirees have taken the plunge, with some estimates as high as 1.4 million senior citizens living abroad. What places should you consider? We’ve compiled a list of seven popular destinations:
Monthly cost for a couple including rent: $2,554
If you’re looking for the best place to retire in Central America, look no further than Panama, according to International Living magazine. Sure, Panama is hurricane-free and a short 2½ hour plane ride to Miami (or 5 hours to Chicago) – but what’s really attractive about retiring in Panama is its excellent retirement (Pensionado) program.
The Pensionado program guarantees Panama residence as long as you have a monthly income of $1,000 coming from a pension or retirement account – and it has considerable perks. After qualifying, you’ll enjoy access to a government-backed program that will substantially help your finances. It includes subsidies for the following: hospital visits, medicine, sales and property tax, as well as heavy discounts on travel and restaurants.
In terms of where to live in Panama, you can choose from multiple geographies ranging from the mountains to the Caribbean to the world-class Panama City.
Monthly Budget for a couple including rent: $1,925
Costa Rica is a well-known, popular choice for retirees based on its large expat community, proximity to the U.S, and reasonable cost of living. Its cloud forests and white sand beaches only add to the package, especially for nature-lovers.
Costa Rica has multiple residency options for foreigners, but its Pensionado Program is specifically designed for retirees. All you need to qualify is a monthly income of $1,000 coming from a pension or retirement account and you’re set. Married couples only need one partner to receive the monthly $1,000 pension income to qualify.
In terms of climate, you can choose between sunny and tropical or mountainous and temperate. The Central Valley is rich in culture and has been popular with expats for decades, but those seeking sun and surf may prefer Costa Rica’s Gold Coast.
Monthly cost for a couple including rent: $1,500
Not sure where to retire? Belize has an especially friendly tax situation for seniors and, frankly, anyone 45 and over. If you qualify, any income earned outside of Belize won’t be taxed by Belize. Belize also has a special program for retirees called the Qualified Retired Person Incentive Program (Belize’s version of an American Green Card). To qualify, you must meet the age requirements and receive a monthly income of at least $2,000 through a pension or annuity.
Another benefit to Belize is that English is the official language – the only country in Latin America, in fact, where this holds true.
Monthly cost for a couple including rent: $1,484
If you decide to retire in Ecuador, year-round temperatures of 77°F (day) / 50°F (night) await. Choose between the busy capital of Quito or a quiet beach enclave, knowing you’re making the most of your money. One of the least expensive options on our list, Ecuador is known for its high quality of life, minimal safety issues and its superior healthcare system. To put the costs in perspective, a 900-square foot apartment in Quito starts at just $538 a month.
Ecuador also offers impressive and inexpensive healthcare. Patients interact primarily with doctors (instead of nurses) and many prescriptions are cheaper, with some as much as 60-70% less than in the U.S. Private insurance is available, but all residents automatically are eligible for a program similar to Medicaid (though it’s restricted to one hospital).
Monthly cost for a couple including rent: $1,740
Further from the U.S., but with a growing number of expats, Thailand lands on multiple “best of retirement” lists for its high quality of living. Choose from bustling Bangkok, the inexpensive north or the beautiful south replete with plenty of beaches.
To give a better sense of cost, you can rent a nice place in almost any part of the country for $500 or less and see an American-trained doctor for $40.
Visas are also relatively easy to acquire, as retirement visas are available for those 50+ who meet the minimum income requirements (a monthly income of about $1,863 USD or $23,000 USD in a savings account).
Monthly cost for a couple including rent: $2,283
The British have been using southern Spain as a retirement destination for decades, so why shouldn’t Americans get in on the fun? The Costa Del Sol is the most popular area for English speakers, with Marbella being the largest city/town. While more expensive than Central American retirement locations, Spain may feel more familiar to those who have travelled in Europe. It also offers a high quality of living and a price tag still 20% less than the United States. Plus, many rental units are essentially half-price, making the cost-benefit analysis even sweeter.
Acquiring a Retiree Visa isn’t too difficult, provided you can show proof of residency, proof of income and don’t have any illness that’s a threat to public health.
Monthly cost for a couple including rent: $1,181
While Nicaragua suffered bad press for decades, things have turned around. Places like MSNBC, Lonely Planet, and U.S. News and World Report have recently shared glowing reviews of retiring in Nicaragua – and for good reason.
It’s very cheap, and you can live well there, to the extent that you could potentially retire 10-15 years earlier than planned (!).
However, while Nicaragua is among the cheapest options on our list, it doesn’t have all the amenities of other Central American countries, since it’s still developing. In short, it’s likely best for the more adventurous retiree. For instance, there can be water shortages depending on the season and drinking local tap water isn’t recommended (but bottled water is available everywhere for cheap).
Weather-wise, Nicaragua is divided into wet and dry seasons like most tropical countries. If you want to “test-drive” the weather (which you absolutely should do before moving anywhere), go at the end of the dry season in late March since this is when temperatures peak in the 90s.
Alissa Green is the Digital Marketing Manager at Alliant. She has 10+ years experience writing/blogging and has written for Jezebel, The Onion, MyFirstApartment.com, and MyFirstCondo.com amongst other sites. The best piece of financial advice she’s gotten was from her mother, who says one should never try to beat the market (thanks, mom!). In her spare time, you can find Alissa enjoying the local comedy scene, exploring different Chicago neighborhoods, supporting the Chicago Humanities Festival and reading up on FinTech.