Retiring abroad can let you live cheaply in an interesting place; you are not all that likely to actually find paradise-on-earth or the fountain of youth, but you might get close enough to enjoy yourself immensely.
There are two main reasons for someone to retire in a country other than where they spent their working life.
- One is climate; people from colder places flock to the Mediterranean, the Caribbean, Central America, Southeast Asia and the South Seas, while others choose a dry desert climate because that is easier on asthmatic lungs or arthritic joints.
- The other is saving money; a pension that is just a pittance in a relatively wealthy country may be enough to live well in a lower-income country, while a substantial pension or a few good investments might let you live in luxury.
The lower costs may let you retire earlier, or take some time off as a sabbatical break in mid-career, or just live somewhere cheap while continuing to work.
Retiring abroad is certainly not for everyone, but it may be worth considering for many. This article aims to provide the basic information anyone considering it will need. Other ways to retire are briefly discussed in the last section.
Senior travel describes time-limited getaways for elderly people.
|“||Now more than ever do I realize that I will never be content with a sedentary life, that I will always be haunted by thoughts of a sun-drenched elsewhere.||”|
Some choose a nomadic retirement, travelling either on their own boat, on cruise ships or with a mobile home. However, most will choose a destination and, at least mostly, live there. If you are one of them, there are many ways to choose the destination.
- Many people stay reasonably close to home — Englishmen in Spain, Japanese in the Philippines, Canadians in Florida and so on — while others range further afield.
- Some aim to be in the thick of things, choosing a major cultural hub like London or Rio de Janeiro, a highly developed tourist area like Cancún (Mexico) or Boracay (Philippines), or a trendy "jet set" spot like Ibiza (Mediterranean Spain).
- Others aim to get away from it all, choosing a rural retreat, some relatively isolated place like Mauritius (Indian Ocean), a picturesque spot off the main tourist trails such as Vigan (Philippines), Flores (Guatemala) or Dilijan (Armenia), or a place that mostly gets domestic rather than international tourists such as Cox's Bazar (Bangladesh).
- Some choose a place to suit their interests — perhaps Queensland for diving, Rishikesh for yoga, or Austria for skiing.
- Others choose a location that is itself interesting and can also serve as a base for exploring a region — perhaps Nassau for the Caribbean, Bariloche for South America, Singapore for Southeast Asia, Prague or Barcelona for Europe.
- Some choose a region that is famously well-provided with some item of interest, Belgium or any of several nearby countries for beer, any of a dozen places including France, the California Wine Country and South Australia for wines, Argentina or Brazil for good cheap beef, various coastal or island destinations for seafood, and so on.
Given a reasonable budget and a temperament that is at least mildly adventurous, it is possible to find a location to suit almost any taste. Often it will be possible to achieve several of the above goals in one place. Starting points for a search might be our lists of Previous Destinations of the month and Previously Off the beaten path featured destinations.
Some destinations attract quite large numbers of retirees, apparently because they are in some ways ideal for it. Destinations with large communities of retirees include:
- Acapulco in Mexico
- Bali in Indonesia
- Belize, the only country in Central America where English is the official national language
- Chiang Mai in Thailand
- The Costa del Sol in Spain, as well as the Canary Islands
- Cuenca in Ecuador
- Dumaguete in the Philippines
- The Greek Islands
- Mediterranean Turkey
- Penang in Malaysia
In almost every case, though, popular places tend to have higher prices and a heavier infestation of pickpockets, scammers and others who prey on tourists. If somewhere on the list above appeals to you, consider nearby places as well; they may be even better for some people.
There are also many people who have emigrated but return to their original country to retire. In Chinese, they are called "sea turtles", after a species that travels widely, but then swims long distances back to lay its eggs on the same beach where it hatched. These people may have the best of both worlds. Consider, for example, a Chinese retiring in China after a career in the UK. Unlike other visitors, he or she will have no trouble with the language and probably not much difficulty getting a visa or adapting to the culture. Unlike other Chinese, he or she will have a British pension, typically larger than a Chinese one, and perhaps a British passport which will make travel outside China easier.
|“||If you reject the food, ignore the customs, fear the religion and avoid the people, you might better stay home.||”|
Settling down in an exotic foreign country is definitely not for everyone; there are many things to consider. For some, moving abroad was the best thing they ever did, while for others it was a complete disaster.
Culture shock can be a major problem. Exotic places and people can be fascinating, but they can also be most irritatingly foreign. Doing some exploration before moving in helps, but there may still be cases of "It's a nice place to visit, but I wouldn't want to live there."
For most people, it will be more sensible to take things slowly, rather than diving straight into a partly unknown culture. For example, instead of selling your home to move abroad, you might rent it out while you discover how a new country suits you. If all goes well, then a few years later you can sell the place back home; if not, you can return home or explore other destinations. It may also make sense to start your life abroad in a tourist town or expatriate ghetto, where life as a foreigner is easier, then consider other areas after a few years when your language skills and knowledge of the country are much better.
When choosing a destination, consider the cost and convenience of travel in both directions. Being too far from friends and family is the single largest reason for people who have retired abroad to give it up and return home. In particular, some people find being a long way from their grandchildren very difficult.
An Englishman in Spain or an American in Mexico, for example, can easily get home now and then and might reasonably invite friends and family to visit. In Pago Pago, both will be more difficult. Note, however, that long distances are not necessarily prohibitive; anywhere with good airline connections may be okay. For example, an American in Paris or a European in Thailand is a long way from home, but many flights are available and some are quite cheap. See our articles on air travel on a budget and the "get in" sections of country articles for details.
Language can be a problem. In particular, tonal languages such as Chinese, Thai, and Vietnamese are often difficult for Westerners. Other languages, especially European languages, may be less difficult for an English speaker, but acquiring any language requires significant effort. There are popular retirement destinations where English is the main language, such as Bermuda and Belize. In others, such as India, Sri Lanka, Malaysia, Malta, Gibraltar or the Philippines, English is widely spoken but other languages are also quite important; you can get along with just English but learning some of the local language will make a long-term stay easier. In still others, such as Thailand, Indonesia or most of Latin America, English is less widespread and learning at least some of the local language is more-or-less essential for long-term residents. See also our talk article and language tourism.
Also consider any local difficulties with transportation or services. Remote or less developed areas may be cheap and interesting, but roads can be awful, electricity unreliable or available only a few hours a day, and Internet or telephone service problematic, not to mention expensive. Are you prepared to live "off-grid", investing in solar panels and/or a generator and fuel? Will you need satellite phone or Internet, both usually expensive? Also, few people in such areas speak English. Having no hospital within easy reach is risky at any age, and this becomes more important after retirement age.
Even if you are used to driving everywhere at home, driving can become hard or even impossible as old age affects your reaction time, your eyesight or even your ability to move. Don't forget the other half of the world drives on the opposite side of the road. Also, some destinations have bad roads or awful traffic, and fuel may be expensive, a reliable mechanic hard to find, parts hard to get or the bureaucracy difficult. Can you reach the most important places without a car from your new home? What about wheelchair accessibility?
Most retirees seek some sort of balance, modern enough to have reasonable services but still exotic and interesting. Many choose a major city or a "tourist town" as their destination, or at least as an initial destination until they know the country and the language better. These areas tend to have good services, and the language problem is often less pressing there; often there is enough of a foreigners' community that you can have a reasonable social life within it. However, such areas are usually relatively expensive and may be less interesting, noisier, more polluted, or more crime-ridden than other areas. Also, some of the tourist towns attract people of a particular type; for a particular place it might be any budget level from backpacker to jet set, and any interest from surfing or rock climbing to sex tourism. A retiree may feel rather out of place in a town full of such people; in the worst case, he or she might find the tourists thoroughly obnoxious. This is one more thing to check when considering locations.
Look into the laws at potential destinations, especially if you have interests that are illegal in some jurisdictions. Homosexuality, smoking dope and using rent-a-wench services are all perfectly legal in some places — though Ecuador and Uruguay are the only low-cost countries we know of that allow all three — but any of them can get you in quite deep trouble elsewhere. See Retiring abroad/Table for some information.
Even drinking alcoholic beverages is illegal in some Muslim countries, and in some states in India. Anyone who asks "Can I bring my guns?" will find the laws of many countries quite uncongenial. Things like vehicles, electrical devices or medicines may be hard to import because they are not certified safe under local standards, even if they are certified in the home country. Some countries have strict laws affecting some forms of speech; for example, in Thailand you could be arrested for insulting the monarchy. Some visas forbid activities such as becoming involved in local politics (even a bumper sticker in some countries) or doing missionary work. Also, some countries forbid crypto-currencies, or importing or exporting the national currency. (see Money)
A retiree may be a target for scams, any of the common scams used against tourists plus a few unique to someone who settles long term and buys property. Given the differences of legal system and customs and that locals have an advantage in dealing with them, it may be difficult or impossible to recover anything if you are taken for a ride. In a 2015 incident in the rather popular destination Phuket a retiree's Thai wife got a long jail sentence for fraud, but her accomplices got off scot free.
Finally, there are an assortment of risks from tropical diseases to earthquakes, volcanoes and typhoons, through to crime, corrupt governments or police, and political unrest. These can generally be avoided, or at least managed, but it takes quite a bit of research, exploration and planning.
Even with good research, of course, there are no guarantees. For example, the Falkland Islands might be a fine destination for some retirees — the area is relatively quiet, scenery and wildlife abound, people speak English, and visas are easy for UK citizens. However, someone who retired there just before the Falklands War would have had their retirement severely disrupted, and that war came as a surprise to almost everyone.
|“||An investment in knowledge pays the best interest.||”|
The Wikivoyage articles on countries, regions and cities provide a good starting point. For some destinations, see also tips for travel in developing countries. We provide links below to government sites with visa information.
A web search on the country or city name plus "expat" (short for expatriate, someone living outside their own country) will often turn up sites with local information. The best of these are very good indeed, a prime information source. However, it takes some sifting to extract the good information; some are basically promotional sites for various businesses, loaded with biased information, some are one-person blogs which may have quite a limited scope, and even the good ones may have some clueless or crackpot participants. It's also good to be aware of when the person writing visited the location. No matter how good the information may be, if they haven't visited in years, it may be outdated and no longer reliable. This is particularly problematic in travel writings from developing countries where things are constantly changing.
Magazines and websites such as International Living, International Citizens, Escape Artist, Transitions Abroad and Expat Exchange cover expat life in general. Others such as Retired Expat, Best Places In The World To Retire and Retirepedia are specifically about retirement and still others, such as Retire Asia, Retire in Asia and Viva Tropical for Latin America are about specific destinations. More general magazines also have material: for example Forbes has a survey of expat-friendly countries and Newsweek has an article on the best countries to live in.
There are also government sources for information. Some governments provide information for their citizens considering retirement abroad, for example the US, the UK and Canada. For information on destinations the US State Department has "background notes" for many countries, and the Canadian government provides "country insights". These are mainly oriented to international business and trade. The destination country's embassy in your home country or your home country's embassy at the destination may also be helpful.
You can get some idea about a country by looking at statistics and indexes, perhaps starting with Wikipedia summaries such as per capita GDP and average household income as cost indicators. Follow their links to the data sources for more detail. See their list by Social Progress Index for a more general idea of living standards. Indicators for safety levels include Wikipedia's page for murder rate, and the Global Peace Index. Other numbers of interest include the Democracy Index, the Corruption Perceptions Index, the Press Freedom Index the Global Integrity Report, and the Gini index for the degree of inequality of income in a society. Mercer rates cities worldwide by quality of living and by infrastructure. Expatistan provides cost of living comparisons for almost any pair of cities.
Perhaps the best statistical overview is provided by the Human Security Index which has data on Economic Fabric (income per capita, income equality, etc.), Environmental Fabric (disaster vulnerability, sanitation, etc.), and Social Fabric (education and information, health, peacefulness, corruption, etc.) for 232 countries. The site provides all their data in spreadsheet format, which enables you to rank countries by any of those indicators to help you to compare and "shop" candidate countries.
For a much less detailed overview table, see our Retiring abroad/Table.
However, none of these numbers can serve as more than a rough guide; the phenomena they attempt to measure are far too complex for any easy summary. Also, there are often large differences from region to region within a country.
The US Geological Survey provides information on various hazards — earthquakes, volcanoes, tsunamis, landslides and floods — see this index. They have worldwide earthquake information. Another source for similar information is About.com. A Swiss insurance company rates hundreds of cities by risk of natural disaster (PDF). The US National Hurricane Center has much information on tropical storms near the US and some data on storms worldwide. The World Bank has information on air and water pollution. WHO has a paper on air pollution. NASA has an excellent topographic map application that includes the ability to look at possible effects of a rise in sea level. See tropical diseases for information on health risks.
If you want detailed business-oriented information and are willing to pay for it, the Economist has reports and forecasts. Business people should also talk to their nation's trade missions; part of their job is to assist businesses doing international trade.
Of course nothing beats actually visiting your possible retirement destinations; research may narrow it down to a short list, but then you need to take a good look at the candidates. Some people spend several holidays in the years before retirement, or some time after retirement, travelling around to check out possible longer-term destinations. If the budget allows, a round-the-world flight might be a fine holiday and a way to look at many possibilities.
|“||If you want to succeed you should strike out on new paths, rather than travel the worn paths of accepted success.||”|
—John D. Rockefeller
A short-term stay in most countries generally only requires an easily obtained tourist or business visa; for many destinations and many passports, this can be obtained on arrival at the airport or other entry point, or can be applied for on-line over the Internet. However, to live long-term in almost any country, almost any foreigner will require a visa. See our country guides for information on visa requirements at various destinations. Follow links there for government sites with authoritative information, or consult an embassy or consulate.
There are special cases where getting a visa may be easier, though there will still be some paperwork.
- There are often special provisions for an emigrant going back to his or her original country — for example, a Filipino who now travels on some other passport still gets special treatment in the Philippines.
- There may also be extra complications; citizens of China and the US, for example, are required to enter the country with that passport; it is illegal to use any other.
- If you have close relatives in a country — for example, if a foreigner marries a citizen or a descendant of immigrants has relatives in the old country — then many countries have some special provisions which may apply. Some countries grant automatic citizenship, or have an expedited naturalisation process, for those who can prove that at least one of their parents or grandparents was a citizen of that country.
- Some countries have overseas possessions where their citizens can go quite freely. For example, it is easy for a Briton to go to Gibraltar or the British Virgin Islands, an American to American Samoa, the U.S. Virgin Islands or Puerto Rico, a Dutchman to Aruba or other Caribbean parts of the Netherlands, a Portuguese to the Azores or a Frenchman to French Polynesia.
- A citizen of one country in an international group can go to another country in that group more easily than an outsider can. For example, a Spaniard can relatively easily retire in Greece or Malta because both countries are in the European Union.
- The European Union, Gibraltar, Liechtenstein, Norway, Iceland and Switzerland have an agreement which allows citizens of any of these countries to stay in any of the others indefinitely with only a valid ID card.
- The Central American countries of El Salvador, Guatemala, Honduras and Nicaragua have an agreement allowing citizens of any of these countries to live in any of the others indefinitely without a visa.
- Citizens of the Gulf Cooperation Council (Saudi Arabia, Oman, Kuwait, Bahrain, Qatar and the United Arab Emirates) had been able to live in any of the other member countries indefinitely without a visa; this was curtailed as Saudi/UAE relations with Qatar broke down in 2017.
- There are also specific arrangements between pairs or small groups of countries:
- New Zealand and Australia have an arrangement that allows citizens of either country to stay in the other indefinitely without a visa.
- Citizens of India may live in Nepal or Bhutan indefinitely without a visa and likewise, citizens of Nepal or Bhutan may also live in India indefinitely without a visa.
- Citizens of the Federated States of Micronesia, Marshall Islands and Palau may live in the United States indefinitely without a visa. However the reverse does not apply to US citizens, who are required to obtain visas to settle long-term in those countries (but not for short visits).
- Chinese nationals from Hong Kong or Macau may live in mainland China indefinitely without a visa, though the reverse does not apply to Chinese citizens from the mainland, who are generally required to obtain a visa to visit Hong Kong or Macau.
- Citizens of Taiwan may live in mainland China indefinitely without a visa, though the reverse does not apply to Chinese citizens, who need visas to visit Taiwan.
- Russia and Belarus, via their membership of the Union State (Russian: Союзное Государство России и Беларуси [СГРБ or SGRB]), allow their respective citizens freedom of movement on that territory.
- Citizens of the United Kingdom and Ireland may live in each others' countries indefinitely with only a valid ID card.
It may even be possible to combine two of the special cases. For example, a German planning retirement could check whether other European Union countries have overseas possessions where EU citizens can go freely or where a visa can be easily obtained.
Quite a few countries offer a retirement visa. These all require at least that you meet some age limit (often 55), show evidence of adequate funds (usually a monthly income, paid into a local bank), and pass both a health check and a police check that shows no criminal record. See the individual countries' immigration department web-sites for details.
- Australia - Retirement
- Argentina - Radicación de pensionado
- Belize (formerly British Honduras) - Retirement (PDF)
- Brazil - Vistos para estrangeiros
- Costa Rica - Residencias
- Dominican Republic - Mapa Ruta del Inversionista
- Ecuador - Ministeria
- Ireland - Retiring to Ireland
- Malaysia - Malaysia My Second Home Programme
- Malta - Residence
- Mauritius - Residence Permit
- Mexico -
- New Zealand - Retirement visas [dead link]
- Philippines - Philippine Retirement Authority
- South Africa - Retired persons permit
- Sri Lanka - My Dream Home Visa Programme
- Thailand - Retirement Visa There is also an Ehow article on these visas.
- Tonga - Assured Income Visa [dead link]
A few countries — Malaysia and the Philippines, for example — have a variant of the retirement visa for people who require nursing home care. This takes more money, but still perhaps less than such care at home. There is still a health check; people with contagious diseases are excluded.
For many of these visas, there are additional requirements. Some countries have a language requirement for long-term visas. Some require either an investment or that you deposit a substantial sum in a local bank. Some require either that you join their national health insurance program or that you have your own health insurance. Some require other insurance, such as liability insurance or life insurance. Some countries may have a substantial annual fee for the visa.
Some retirement visas allow you to work, though you also need enough pension or assets to get the visa. Some limit or prohibit employment in the destination country, and some prohibit employment entirely; even an Internet business is disallowed. Some countries do not allow you to take most jobs but do allow some income-generating activity; for example in Paraguay you can open a restaurant or hotel and in Mexico you can work as an artist.
In general, access to social welfare is not granted to people on a retirement visa, so you will need to make sure you have enough funds to cover any potential emergencies.
For almost any country, a web search on "retirement visa" (or "pensionado" for Spanish-speaking countries) plus the country name will turn up much information, mainly travel agents or law firms offering a visa service. Some countries require that you go through a government-approved agent. Where it is not required, using an agent will be more expensive than applying yourself, but it may be considerably more convenient and the cost is often reasonable. If you choose to use an agent, it helps to know the rates and requirements from the government site (links above) so you can avoid any excessive charges.
See Retiring abroad/Table for a summary of financial requirements for retirement visas.
It is possible to retire in some countries using a standard immigration/settlement visa rather than a special retirement visa.
- Poland does not have anything like a retirement visa. Instead you need to enter the country under a short-term visa, and then apply for a long-term visa at the office of the province in which you intend to live. Eventually you can apply for a settlement permit.
- Chile requires two years of temporary residence before a permanent residence visa application can be processed.
For many countries, this strategy does not work well because they have quite strict controls on immigration. On the other hand, if you do meet the immigration requirements this may let you go to a country that has no retirement visa.
Many countries have an investor's visa. If you are about to enjoy a well-funded retirement, you can put a lump of money into a local business and thereby gain the privilege of living in the country. We list some examples here, but if you have a few million dollars (invest some, and buy a house), you can go almost anywhere. For a country that does not have an investor visa, an investor may be able to set up a company and have it hire him or her in some management or consulting role. Other countries that do not have a specific investor visa may have special schemes which allow foreigners to obtain permanent residency by investing a large amount of money in a local business.
- Australia - several different programs for various sorts of business person or investor
- Bermuda - Immigration department
- Brazil - Vistos para viajar ao Brasil
- Canada - The federal investor's visa scheme has been terminated, though an entrepreneural visa is still available.
- Quebec has its own provincial investor's visa with different requirements, though it would require you to invest and live in Quebec.
- China - Permanent Resident Requirements [dead link]
- Fiji - Investment
- Hong Kong - Immigration department, straight investment, HK$10 million, and a cheaper scheme for entrepreneurs
- Japan - Investor/Business/Management visas
- Qatar - investor visa
- South Korea - Corporate Investment Visa
- New Zealand - NZ$750,000
- Saint Kitts and Nevis - no investor visa, but citizenship can be obtained through investment
- Singapore - several programs
- Taiwan - Resident visas for investment
- UK - £2 million
- USA - US$1 million
For several countries, a pure investment visa requires a large amount of money but an entrepreneur visa — for someone who intends to start and manage a business in the country — requires much less. However, there are generally additional requirements, such as having relevant experience and providing a detailed and plausible business plan.
For some countries, language requirements are waived for investors. For example, for nearly all classes of visa Canada requires that an immigrant speak English or French. However, there is no such requirement for an investor.
For some countries, investment is almost the only way to get in long-term. For example, Chinese permanent residence requires one of four things: investment, four years in a high-level job in China, five years married to a Chinese, or "great and outstanding contributions to China".
It is also possible to be semi-retired but take a job abroad, partly as a way of getting a working visa. This might let you go to countries which do not offer a retirement visa. The most common job for this is teaching English. There are possibilities for consulting jobs if you have the right skills, see working abroad. There are also quite a few volunteer posts; someone with a good pension can afford to work for low pay.
Some countries which have several aspects desirable for retirees — low cost of living, interesting culture and pleasant climate — do not offer a retirement visa; examples include Vietnam, Laos, Myanmar and Cambodia. Some people retire there nonetheless, generally getting a visa either by working as a part-time volunteer at some NGO or by setting up some sort of business and using a business visa.
Another way to live abroad is to get a student visa; see studying abroad. Depending on destination, one might profitably spend a few months or years on language study. Anyone with an interest in the history or archaeology of a particular area might also find studying near the primary sources for their field interesting.
If you really like travelling and have both a fairly generous budget and a "good" passport (getting visas is relatively easy), it is even possible to retire by moving around with a series of tourist visas. This limits you to a short time in each country; tourist visas are typically only good for 30 to 90 days. It is also expensive; you live in hotels and eat in restaurants a lot, and your transport costs are high. Even if you choose a low-cost region and backpacker-class facilities, the bills mount up. However, some people actually do this, wandering about Southeast Asia or the Caribbean with the occasional trip elsewhere. Others do something similar using cruise ships for both transport and accommodation.
|“||Retirement: It's nice to get out of the rat race, but you have to learn to get along with less cheese.||”|
To live abroad, you probably need multiple bank accounts, at least one back home and one in the destination. Ideally, both banks should be chosen partly because they have plenty of international branches; it does you little good, for example, to have a bank account that you cannot draw on in your new home. As a general rule, the major banks are better for this than smaller regional banks, but there are exceptions in both directions.
HSBC is the world's fourth largest bank, and a popular choice for expatriates because they have many international branches and some services specifically designed for expats. They were originally Hong Kong Shanghai Bank, set up in the 19th century to serve the China trade, so they have considerable experience with international banking. Headquarters are in London, but they advertise themselves as "the world's local bank" and have 6600 branches in 80 countries.
Major credit cards — MasterCard, Visa and, to a lesser extent, American Express — are widely accepted around the world, as are traveller's cheques from major vendors — American Express or Thomas Cook. However, there are local variations; see country articles for details. Also, if you are moving large amounts or doing many transactions, it pays to check the costs. You might get five different combinations of exchange rate and service charges moving money in five ways — exchanging cash, exchanging a traveller's cheque, doing an electronic funds transfer, using a credit card, and doing an ATM withdrawal of local currency with a foreign card. Which is most advantageous will vary depending on where you are and which bank you use on each end of the transaction. See also our article on money.
More generally, be aware of and somewhat cautious about exchange rates. For example, the Canadian dollar dropped from over 95 to about 80 US cents in just a few months around the start of 2015, and the British pound dropped about 10% in a day after the Brexit vote; such changes can have large effects on expats who are paid in one currency but have their expenses in another. Your planning, either simply for retirement or for investment, needs to take account of this risk.
There can be complications. Some countries — Thailand, China and India, for example — have legal restrictions on exchange of foreign currency or on import and export of the local currency. Some retirement visas, such as the Philippines, require you to exchange a fixed amount monthly at government-approved banks. It is not a problem in the Philippines but in some places the official exchange rate may not be to the traveller's advantage.
Pensions can also have complications. Private or corporate pension plans will generally just pay you, wherever you may be. However, conditions for government pensions may depend on how long you have lived in the paying country and where you live when you apply. Generally the most important consideration is how long you lived there between ages 18 and 65; you get a full pension if you lived there for all that time. If not, each country has a different formula for calculating how much of a reduced pension you will get. Some countries also place restrictions on payment of pensions to non-residents; whether you can collect a government pension at all may depend on where you live.
In planning a budget, remember that prices on many things will be different from the ones in your current location. In particular, your everyday dinner may be considered exotic foreign food locally and, even in a generally low-cost country, the cost of these and other luxury goods may be high—if you can find them. If you really want to go out for a good steak or a nice glass of a single malt, for example, it will very likely cost at least as much in Bangkok as in London or New York, and will certainly be harder to find. In Back-of-beyond-istan, neither steaks nor good whiskey are likely to be available; the only pseudo-Western choice might be expensive low quality coffee or hamburgers. Doing your own cooking or employing a cook helps, but some ingredients may be hard to find or expensive.
Clothing can also be a problem, especially if you are a different size or shape than the locals. Most low-cost countries have good cheap tailors, which solves part of the problem rather nicely. However there are things the tailors cannot do; for example, Westerners in Asia often cannot buy shoes or brassieres where they live.
If you have children who are still of school age when you retire, the need to educate them may affect both your budget and your choice of destination. There are international schools in many places, mainly for the children of expatriate employees of government and large corporations. These are usually quite good but they are not available in all destinations and they tend to be very expensive; most parents do not care because an employer foots the bill, and the employers do not care much since it is a necessary business expense. There are directories of these schools at International Schools Services and Council of International Schools.
There are other educational choices — the local schools where you are, boarding schools at home or abroad (Tatler magazine does an annual guide for those in the UK), home schooling, or hiring a tutor. For younger kids, Montessori schools are also widespread and popular with expat parents. Some kids may be best off left in their current schools with their current friends; you might have them move in with relatives, into a university residence, or even into an apartment.
You also need to budget for shipping costs and for travel costs for visiting home or seeing the region. You may need communications services like high-speed Internet, satellite TV, perhaps satellite phone. Also budget for things you may need from abroad, such as English books and CDs or DVDs, maple syrup or Marmite. Ordering such things abroad raises other questions: how reliable is the postal service, and will Customs officials apply censorship?
Travel insurance is generally designed for shorter trips, not for people living abroad, but it may be worth considering for retirees. Obtaining other types of insurance locally, such as fire and theft protection for a residence or insurance on vehicles, is also often worthwhile.
|“||This is a question too difficult for a mathematician. It should be asked of a philosopher.||”|
—Albert Einstein, about his income tax form, 1944
Taxation is often complicated, so for anyone with substantial assets or income getting professional advice is almost certain to be well worth the cost. An investor will likely need accountants in both home and destination countries plus at least one lawyer. This section tries to cover the basics, but it should definitely not be your only information source. Even if your assets and income are small, you probably need to at least check the rules for both countries by reading government web sites and/or making inquiries at the tax offices.
In most cases, people on retirement visas enjoy a tax exemption in the destination country. Investors, however, are generally not exempt and must plan accordingly.
Taxation by the home country may be an issue. American citizens and resident aliens are required to file and are taxable by the US on worldwide income even if living abroad. There is a Foreign Earned Income Exclusion (form 2555) that allows an American living abroad to avoid tax on up to $100,000 a year earned abroad, and a Foreign Tax Credit (form 1116) that reduces US tax if you are taxed abroad. In many expatriate communities there are some mostly-retired accountants who supplement their income by helping Americans with this, and a company called Bright Tax offers US expat tax services worldwide.
Other countries generally do not tax on worldwide income if you do not reside in that country, but most will apply tax if you have an income in the country. For example, take a Canadian who has $20,000 a year of income from renting out a house in Canada, but lives elsewhere. If he or she lives in a country such as the US which has a tax agreement with Canada, then the Canadian government takes a flat 15% of the Canadian income, $3000 in this case. On the US tax return, he or she reports the $20,000 as income and deducts the $3000 from the US tax due as tax already paid. If he or she lives in a country which has no tax agreement with Canada, then the Canadian government takes a flat 25%.
As for most taxation, enforcement on these can be draconian; should an expatriate fail to pay these taxes, his or her agent in Canada becomes legally liable for the entire amount and both the expat's and the agent's bank accounts can be seized. Also note that in some countries, including Canada, a pension that is small enough to escape tax if you live there becomes taxable at 15% or 25% if you become a non-resident.
Depending on a whole complex of factors, it may be advantageous to have some of your money in a tax haven, which need not be either your home country or the one you live in. For example, an Englishman living in Thailand might have a Channel Islands account, and the Canadian in the example above might consider selling the house and investing the proceeds through a Hong Kong stockbroker. On the other hand, it might be better to mortgage the house and do something clever with the proceeds, since the mortgage interest would be a deductible expense for the taxation. Note, however, that Americans are required to report foreign assets over $10,000 to the IRS and many foreign banks (under threat of having their US business restricted) co-operate and report to the US government on American-owned accounts.
In some cases it may be advantageous to set up a company for taxation or other reasons. For example, an employee of a Hong Kong company has an easier time with Chinese visas than an individual foreigner and a foreign company can own land in the Philippines whereas an individual foreigner cannot. Of course this requires expert local advice, at least a lawyer and often others.
|“||Buy land; they've stopped making it.||”|
- See also: Second homes
Many foreign retirees buy property — a home and/or a business — abroad, though others find it simpler and lower-risk to just rent. This section covers buying a home; buying a business is generally more complicated and the rules vary by country, so we do not attempt to cover that.
When choosing a place, you may need to allow space for whatever visitors you expect and to consider getting furniture that gives you flexibility in accommodating visitors, such as a couch that folds out into a bed. Or perhaps just choose a place with a good cheap hotel nearby.
Remember that over the long term your plans can change for many unpredicatable reasons so always consider how easy it would be to sell the property. In some countries particular types of property might mainly appeal to e.g. overseas purchasers and then selling your property might become harder should e.g. exchange rates move or immigration policies change.
In some countries, there are legal restrictions on foreigners buying property. For example, in Thailand or the Philippines, a foreigner cannot own land but can own a condominium. In Indonesia, a foreigner can buy a place, but only above a minimum price which varies by region.
In some of the retirement visa deals, buying property gets you off the hook on the cash deposit. For example, for a Philippines visa you must put $10,000 in a local bank and leave it there as long as you stay, unless you buy property. However, if you spend $50,000 or more on real estate that complies with government rules (not a place that is still under construction, for example), you get the deposit back.
It is absolutely necessary to be sure you get good unencumbered title to whatever you buy. Without that, you could be forced to move without compensation, or to pay to clear up a problem. Sometimes title problems occur due to outright fraud, a crook selling a property he or she does not own; be suspicious of anyone who offers an exceptionally fine price and wants to close quickly. Or there may be several people with a legal claim to a property: more than one child for the parents' house once mom and dad are gone, ex-husband and ex-wife, and so on; an unwary buyer may be caught in the crossfire of a family feud. In some countries aboriginal land claims may conflict with what the settler-dominated government thinks is the case, and again an innocent buyer can be caught in the crossfire. In many countries a contractor who does work on a place and is not paid can register a "mechanic's lien" against the property; no-one can get clear title without paying him or her off. A mortgage lender also has a claim that must be paid before title is transferred.
What you need to do about possible title problems varies by country; your first step should be to seek expert local advice. In many places it is enough to hire a good lawyer to handle your purchase; he or she will check the title as part of standard procedures, and will ensure that all liens or mortgages are paid off before or at closing. In some places you can buy title insurance which protects you if unforeseen problems crop up later, and this is sometimes a very good investment.
|“||When I was a kid my parents moved a lot, but I always found them.||”|
In planning a move, allow for shipping costs and consider which things might be better bought at the destination than shipped. As a general rule, furniture and appliances are better bought on site than shipped. This reduces shipping costs, avoids difficulties with different electrical systems, and often means you have a warranty that applies where you are. However, there are plenty of exceptions; you need to work out which of the exceptions apply to you.
Shipping costs can go up to well over $10,000 for a long-distance move of a big load using a full-service company that handles packing and does door-to-door delivery. Typically, though, they are much less. Paying airline excess baggage fees is one of the most expensive ways to transport stuff and should be avoided if possible. Shop around; there are some good deals out there, though it is necessary to be cautious about cut-rate vendors. Consider companies that serve an immigrant community; many overseas workers send stuff back to the old country and it is generally small loads, so these companies are usually best if you have a small-to-medium load going to a country they serve.
If there is some way to reach your destination overland, and you are confident you can make the trip, you will be able to carry a lot more than the rather low weight limits on airlines. If you live in Britain and want to retire in Southern Spain, loading your car with your stuff and simply driving there (using a ferry or the Chunnel) is certainly doable. It may even be worth renting a larger vehicle or putting a trailer on the car. If your origin is Japan and the destination Europe, it's probably not worth the trip round the world overland, though.
If you have items of any sort which are small, high-quality and useful — say kitchen pots and knives — by all means bring those; replacing them is likely to be uneconomical, and if you are used to good tools then using lesser ones can be unpleasant. Larger items are a tougher call — a fine sound system may be worth bringing even if the speakers weigh a ton and the voltage is wrong, but again it may not be. If you have good art or craft items — say paintings or carpets — consider bringing them along; they will make the new place feel much more like home. On the other hand, also consider giving or loaning them to family and friends who you know will appreciate them.
Books are heavy so transporting them can be a problem but bringing at least some of them is essential for many travellers, especially when planning for a long-term stay. If you are sending a freight shipment for household goods, then including books in that will be the cheapest way to transport them. If you are travelling light and want to bring books, the post office may be far cheaper than airline excess baggage charges; some countries' post offices have a special cheap rate for mailing books. Acquiring an e-book reader is also an alternative worth considering.
In particular, cookbooks may be of great value if you either cook yourself or want to train a cook you hire at the destination. Of course there are also many cookbooks and recipe collections on-line; one good source is Project Gutenberg. For traditional American dishes see the Whitehouse Cookbook, published in 1887 and written by the presidential chef of the time. For British cookery in that era, try Mrs. Beeton's Book of Household Management. There is also much cooking information on Wikibooks.
Also consider import duties, which can be prohibitive in some cases. For example, Singapore is a duty-free port for most things so bringing most electronic items there makes little sense. However, their duty on automobiles is 31%; coming on top of shipping costs this means bringing a car there is probably impractical. Other places have high duties on electronics so you might want to bring those, or stop in Singapore or Hong Kong to buy them en route. Keep in mind that eventually you will probably need to purchase something that was imported. Check the duty rates before committing to a certain country.
Many countries have an exemption so that there is no duty for personal household goods for someone moving there. For example, someone going to Thailand on a retirement visa can bring in personal goods duty-free within six months of issuance of the visa. Some countries, such as Malaysia, even allow a retiree to import a car duty-free.
|“||I think you might dispense with half your doctors if you would only consult Dr. Sun more.||”|
—Henry Ward Beecher
Health concerns are important, especially with advancing age; availability and cost of good care are always factors in choosing a destination. In some cases, they may be the deciding factors; see medical tourism. While the cost of healthcare is often lower in developing countries than in developed ones, the standard of care will sometimes not be up to what you are used to at home. On the other hand, it may sometimes be better; for example, lower labour costs might allow a hospital to have a better ratio of nurses to patients. Also, while professional fees and costs for common medicines are generally lower, costs for things that need to be imported, such as dental implants and some drugs, may be higher than at home.
You may need vaccinations or other precautions such as anti-malaria medication. Consult a doctor with expertise in travel medicine, or visit a travel medicine clinic, well before your planned departure.
Bring your medical records; your doctor at the destination will need them.
Health insurance should be part of your plan and budget. In some countries, people on a retirement visa are eligible for, or even required to enroll in, the destination country's health insurance scheme; this may be useful, but you might need other insurance as well. If you live abroad, you may no longer be covered by your home country's government health insurance system and if you have a private plan, it may not cover everything you need abroad. Whatever insurance you have, or will get in the new country, it is a good idea to review it when moving to see if you need to make additional arrangements. In particular, many policies do not cover evacuation in an emergency or problems that may crop up while you are outside your country of residence.
Insurance coverage may not be restored immediately if you return to the home country. For example, Canada has "universal" health insurance, but you must be resident in a province for three months before you are covered. Without other insurance, a sick person might be unable to go home because he could neither afford to pay for treatment himself nor survive three months without it. An exception is that if you are employed abroad, then you can keep the Canadian insurance valid for up to five years, but this requires an actual job in the destination country; it does not apply if you are retired or working over the net.
A Global Medical Insurance plan (Reddit - Guide to International_Health Insurance/) would cover you both in your home country, your country of residence abroad, as well as any other country you may want to seek treatment in. There are a wide variety of plans that be comprehensive or bare bones. Benefits can include inpatient care, outpatient care, medical evacuation, health and wellness checks, vision, dental, and more. If you are retiring abroad, you should check to make sure your plan will continue on for your lifetime (some plans are terminated when you reach a certain age).
It is also worth considering the possibility of dying abroad. In the worst case — local friends have no idea how to contact family, there is no will, and there's an apartment full of stuff that should probably go to the local lover but he or she has no legal status to claim it — this can create a real mess, but various simple measures can make the aftermath much easier. These can also help in non-fatal emergencies such as being arrested or injured, or becoming seriously ill. Choose a local friend and a family member back home and give them each other's contact details. If your country's passports have an emergency contact section, fill it out. Register with your embassy or consulate and give them emergency contact information.
Write a will and ensure your named contacts can access it. As a will isn't read until after death, you'll likely need separate documents to indicate who is to make medical decisions, or have power of attorney for other matters, if you are alive but incapacitated.
In some cases a spouse may be eligible for a pension from the home country. Consider a Canadian guy who dies abroad and has someone the Canadian government considers his wife — he either legally married her or lived with for a year then filled out paperwork at a consulate to acknowledge her as a common-law wife. In those cases she almost automatically gets half his CPP pension for the rest of her life, even if she remarries. This will typically be only a few hundred dollars a month, but in a low-income country it may make a large difference in her life. With neither a legal marriage nor registration of a common-law relationship, she might still try to get the pension but would not be likely to succeed. The rules for this vary by country and by type of pension and are often fairly complex, but if you have both a pension and a Significant Other then it is worth investigating what rules apply in your case.
|“||The Net interprets censorship as damage and routes around it.||”|
Communications become vitally important when you live overseas. Low-quality, expensive or unreliable communications systems are a problem in some areas, and censorship is a major difficulty in others.
Consider having a backup communication system to use if other things fail. For example, both phone and Internet connections might stop working if an earthquake took out an undersea cable or the government went into a panic about some unrest in the country. If that is a risk where you are going and communications are critical for your life or business, be prepared. Depending on your exact situation, it might be enough to have a short wave radio or satellite TV to get international news broadcasts. Others might need two-way communication as with a ham radio set-up or a satellite phone. On the other hand, some may be fine with nothing at all.
If your retirement plans include a vehicle, perhaps an SUV or a sailboat, consider equipping it with a communications system that can double as backup for your home system.
Other ways to retire
|“||The best time to start thinking about your retirement is before the boss does.||”|
This article covers moving abroad to retire. There are other ways to manage retirement; we try to list most of them in this section, but make no other attempt to cover them:
Seasonal migration works well for birds, and sometimes for people. Some retired people maintain two homes, perhaps spending summers near family and friends and winters somewhere warmer; they are often called "snowbirds" in the Americas, while "swallows" is used for Europeans who winter in South Africa. Others live mostly in their home country but travel a lot in winter. See also vacation homes.
Grey nomads live a mobile post-retirement lifestyle; this lets you see more places and also gives you the option of migrating with the seasons. Often this involves travel with a mobile home or by boat but, with enough money, it is also possible to retire (or just to winter) as a passenger on cruise ships, coming ashore only occasionally to change ships or to visit friends and family. Another variant is to have both a house in some interesting place abroad and a boat or vehicle for exploring nearby areas.
The book and website The Four-Hour Work Week introduce "lifestyle design" techniques, including the notion of taking a series of "mini-retirements" spread out through a career rather than waiting for one big retirement late in life. The site Retire Early Lifestyle also has some online info, and promotes a book The Adventurer's Guide to Early Retirement.
Quite a few people choose to live abroad without retiring. Arguably, this makes for a more interesting life and it can certainly save money. One way to do this is to work abroad, but it also works well for people who live off investments or who earn money elsewhere, for example by running an Internet business or doing really long-range telecommuting. The classic example is Arthur C Clarke (author of 2001: A Space Odyssey, among other things), living in Sri Lanka while collecting book and film royalties in hard currency.
For aging hippies and others who really want to get away from it all and go back to the land, the classic reference is the Whole Earth Catalog. Other sources include Off Grid Info and Appropedia, an appropriate technology wiki. Also, the Global Village Construction Set offers "an open technological platform that allows for the easy fabrication of the 50 different Industrial Machines that it takes to build a small civilization with modern comforts."
If you have plenty of money, there are even a magazine and web site devoted to marketing private islands around the world. Prices start around a hundred thousand dollars for an undeveloped island in backwoods Canada and there are a lot of nice-sounding properties in the half million to five million range, mostly with an interesting location and a nice house. At sky's-the-limit prices, there are properties with prime locations and very luxurious housing; many include businesses such as resorts and marinas.