Retiring Abroad on the Cheap? Money Matters to Consider First
Written by: Kristy Welsh
Last Updated: September 11, 2017
If you want to stretch your retirement dollars, there are plenty of places to retire abroad on the cheap. But before you have your heart set on it, do your homework first. One or more of the following factors could change your mind.
Examine Your Current Cost of Living
When you start looking into affordable retirement destinations overseas, don’t bet the bank on cost of living estimations. Certainly, they’re a good way to narrow down your search, but your cost of living could vary depending on your personal preferences and expectations.
Your best bet? Before blindly deciding on a retirement spot, spend a good chunk of time there to get an idea of just how much you will likely spend to maintain the lifestyle you want, in terms of housing, food, entertainment, and other cost of living expenses.
How Much Do You Have in Savings and/or Retirement Income
In order to acquire a retirement visa, most countries require proof of retirement savings and/or retirement income. Look into the specific requirements of your destination country.
Medicare won’t cover healthcare abroad, which is not to say you shouldn’t keep it.
While you will want to find an alternative for basic medical needs within your new home country, you can always return back to the U.S. and use your Medicare for major procedures.
As for basic medical coverage you can use in your destination country, look into the public healthcare system. Will they allow you to pay into the system for healthcare access? Or is healthcare so cheap there that you can afford to pay everything out of pocket?
Taxes Required to Federal Agencies
No matter where you retire, as long as you are a U.S. citizen, you’re required to file federal income taxes. This includes any income you earn from work in your retirement years, as well as income made off of investments.
Travel to and From the U.S.
How often will you want to visit family and friends back in the States?
Look into the cost of round-trip flights and do the math on what it will cost you to travel back and forth. And remember to factor in hotel accommodations (if applicable), as well as the cost of food and entertainment while you’re here.
Looking to retire on the cheap without leaving the States? Check out our top 20 list of the most affordable places to retire in the U.S.