It is estimated that over eight million Americans and 13 million British nationals living overseas, with a high percentage of these eventually retiring abroad. This figure that has grown steadily over the last few years and is expected to increase further in the next few years as the baby boomer generation reach retirement age.
There are a variety of reasons why retirees choose to spend their golden years outside of their home country – some are seeking to make their pensions stretch further, others wanting better weather or a different way of life or simply to embark on an exciting, new adventure when they no longer have to work.
Latin America is a popular choice for international expatriate retirees and it is not difficult to see why. For one thing the attraction is the wonderful climate with many Latin American countries enjoying moderate temperatures year round. Affordability is another major draw. The cost of living in most, if not all, Latin American countries is far lower than in most western countries which means that pensions go much further affording a lifestyle that would be unattainable back home with first-class healthcare at a fraction of the price and the possibility of employing help around the house.
Of course it’s not all roses – there are always challenges when you choose to up sticks and settle in a foreign country. One of the biggest drawbacks when it comes to Latin America is safety. Street crime can be a problem with the drug trade also thriving in certain areas. Communication can also be an issue for non-Spanish speakers, a potential problem which should not be underestimated as it can make retirees feel isolated and homesick.
It should also not be forgotten that many Latin American countries are still developing and a lack of services and infrastructure taken for granted in the west can be frustrating for those opting to live in less developed areas outside of the major cities.
It is up to you to weigh up the pros and cons of such a big move and have realistic expectations of what life will be like in a different country. If you have done that and decided that a retirement in Latin America is for you then where should you head?
Here are the top five retirement hotspots across the continent according to the International Living Retirement Index 2017. This index rates countries on ten different criteria including the cost of buying or renting housing, ease of obtaining permanent residency, cost of living, healthcare, infrastructure and climate.
Visa laws: A Temporary Resident Visa is intended for those wishing to live in Mexico for anything between six months and four years. If you choose to make Mexico your home indefinitely you will need a Permanent Resident Visa.
Highlights: Mexico rates highly for its combination of exoticism and familiarity and for a very affordable cost of living, especially with the current dollar to peso exchange rate. Healthcare in Mexico’s best hospitals rivals standards in the west but for a third of the price. English is widely spoken and if you wish for a social life with fellow English speakers there are over 1 million Americans alone living in Mexico. For an easy, relaxed lifestyle in the sun, it’s hard to beat.
Visa laws: The country’s pensionado programme offers residency to anyone proving that they have a minimum of US$1,000 of income for life.
Highlights: A warm, sunny climate matches the character of the welcoming Panamanian people. Whether you prefer the cosmopolitan vibe of Panama City, a laid-back lifestyle on sunny beaches or the beauty of the green and lush highlands there is something for you in Panama. The infrastructure is generally good and Panama comes top of the pile when it comes to benefits and discounts, which are available to expats who are part the Pensionado programme.
Visa laws: Ecuador’s income requirements for a pensioner visa are even lower than Panama’s – you’ll need proof that you receive just US$800 per month. Find out more here.
Highlights: There’s a clue as to why Ecuador is such a great place in the name – it’s near the equator. Coupled with the mountains, this location means that you can find pretty much any climate you like within its borders. Other big plus points include the ease of fitting in and great benefits including reduced fares on public transport, flights and entry to many events.
4. Costa Rica
Visa laws: Like Panama, Costa Rica’s immigration services run a Pensionado programme, if you can prove income of at least US$1,000, as well as a Rentista programme if you don’t have a fixed retirement income but can prove a minimum of US$2,500 for two years or are prepared to deposit US$60,000 in a government-approved bank.
Highlights: Costa Rica is a safe and stable country – it doesn’t even have an army for goodness sake! Healthcare is top notch, cost of living is low and it is a stunningly beautiful place to live with exceptionally friendly people, locals and expats alike. What’s not to like?
Visa laws: Retirees can qualify for a TP-7 retirement visa with proof of pension income of US$700 or more. Non-pension income requirements are higher. You’ll find a good explanation of the different visas here.
Highlights: Colombia only entered the index in 2007 and in ten years has climbed its way up to fifth place. Variety is the name of the game when it comes to landscapes. With mountains, rainforests and beaches all part of the jewels Columbia has to offer, there is definitely something for everyone. It is known for its high standard of healthcare, you might find yourself living longer too! Columbia also rates highly for ease of fitting in and entertainment and amenities.
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As you will see, you don’t need to be a millionaire to enjoy a millionaire lifestyle in Latin America. Whatever you are looking for if you are retiring abroad, you will find it somewhere on the continent whether in the top five listed above or countries lower in the list including Nicaragua (8th), Honduras (11th), Peru (14th), Belize (15th), Bolivia (18th), Guatemala (22nd) and Uruguay (23rd).
If you are looking to retire abroad and one of the above South American destinations is tempting, make sure that you do your research before taking the plunge. There are dozens of considerations to take into account when making a decision, not least your financial planning. If you decide to take the plunge it is useful to seek professional advice on the best way to manage your investments and income while living abroad and other money-saving financial tips such as the most cost-effective solutions to managing your currency transfers and banking requirements. Make sure you have adequate medical insurance for the country you are moving to and take the annual cost into consideration when calculating your annual disposable income.
Credit: Infinity Solutions, http://blog.infinitysolutions.com