1. Investigate the crime rate. Places like Brazil and Mexico can be extremely dangerous. There are safe places in almost any country, but consider how much you might be restricted in your daily activities.
2. Can you take living far away from friends and family? Losing contact with these people is the number 1 reason why people return to the USA.
3. Consider what medical care is available, and at what cost. In many countries it’s a pleasant surprise that you can buy affordable insurance and quality care. In others you might be disappointed in the quality of care, and face an expensive medical evacuation back to the states. This is particularly true for some of the medical specialties Americans have come to expect.
4. Will you have to live in a gated enclave? For many folks, this is OK. For others, it might be too restricting a lifestyle.
5. Check out the tax situation. This is perhaps the most complex area to investigate. The Forbes article explained how living in France can be affordable from a tax standpoint, if you take the right steps like putting your assets into a trust and distributing money to yourself in a certain way. For the unwary, however, double taxation and steep inheritance taxes might take away the bargain status.
6. Evaluate the political situation. Some countries in Latin America have a changeable political environment. The situation might be peaceful one day, but a new dictator could change all of that. You don’t want to a resident on the day the government is overthrown.
7. Are you OK with widespread poverty. The reason why you can hire a maid for $50 a week in some countries is because of the grinding poverty in your new country. Some people find they are not comfortable living in a place feeling like they are the feudal barons among the serfs.
8. Will you be welcome as a resident? Some countries like Australia only want high asset or high income residents, so budget seekers might be unwelcome. Obtaining a visa might be harder than you think.
9. How will you get money sent to yourself. Forbes reports that the U.S. prohibits direct deposits into accounts in certain countries like Vietnam. As a result you must follow tight restrictions on how your social security payments are made to you, and processing fees can take a big hit of your income.
10. Just how adventurous are you. In our experience the happiest expatriates fall into 2 classes. Those who love immersing themselves in another culture, including learning the local language, make up the first group.The other group is very happy to live in a gated community and embrace the lifestyle there. Those who retire abroad just to save money are rarely the happiest.
Forbes also came up with its list of the friendliest countries for retiring abroad. Making the Forbes cut of the best places to retire in the world were Austria, Thailand, Italy, Panama, Ireland, Australia, France, Malaysia, Spain, and Canada.
Bottom line: Retirement abroad requires careful research. Talk with people who have done it. Read the books. Hire a tax expert. Determine your priorities and carefully investigate the places you are considering. Lastly, go ahead and visit your new paradise. If you like it, rent for a while. Ultimately that’s the only way to be sure.
For further reference:
Don’t miss our “Retiring in Mexico: The Good, the Bad, and the Ugly” article.