The cost of living in the United States is significantly higher than the cost of living in a number of other countries. As such, many people who are retiring are looking into non-traditional options such as retiring abroad. Retiring abroad can allow your retirement nest egg to go a lot farther; however, you need to carefully consider the pros and cons before deciding if it is the right choice for you.
Advantages to Retiring Abroad
When retiring abroad, there are a number of locations you can consider. For example, Belize has become an especially popular location for those considering moving to another country to retire since Belize is an English-speaking location that offers other incentives to retirees. Whether you are considering Belize or another similar location, the pros and cons are largely going to depend upon the spot where you pick. However, some of the major advantages can include:
- A lower cost of living. According to The Traveling Guy, the average annual income in Belize is $3,190 per year, and there are many other similar areas with equally low salaries. Even a small nest egg and social security or pension payments can go a very long way in a country with such a low income and with the costs of goods correspondingly low. The low average salaries also make it possible for you to hire household help, which can be important
- Favorable tax treatment. Many areas offer tax incentives to those who are retiring there. For example, Belize offers a Qualified Retirement Program that lets you come into the country without paying import duties on your vehicle or possessions and that lets you live in virtually tax free as long as you aren’t earning a significant income while living there.
- A great climate. If you choose Belize or a similar area, you can enjoy balmy and warm weather. This is a major benefit for people who have spent their entire lives living in cold-weather locations. It can also be helpful to have pleasant weather as you age and develop joint problems or become more prone to being seriously injured by slipping on ice.
- Beautiful surroundings. You can pick an island location and enjoy a lovely oceanfront view for far, far less than you can have a waterfront home in the United States.
- Lower cost medical care. Many areas of the world offer medical care for significantly less than in the U.S., or even offer free medical care.
Disadvantages to Retiring Abroad
While there are some significant benefits to retiring abroad, there are also some disadvantages as well that need to be considered. For example:
- Lifestyle changes can be difficult at a more advanced age. You may be set in your ways and enjoy your American foods and comforts and may be unable to get many of these things abroad. While you can typically buy an American-style house, most people who retire abroad will change the way they live, become less dependent upon air conditioning and eating mostly local food. This is the best way to maximize the savings associated with living abroad.
- Medical treatments may not be as advanced. While you can usually get medical care abroad, you may not have access to all of the medical options you have in the U.S. This is especially true for more complex medical problems such as cancer or heart issues.
- You’ll be far from family and friends. You’ll have to leave your kids, friends and family and those who you have spent your life with and go live somewhere far away on your own.
Making the Choice
Ultimately, whether or not to retire abroad is going to depend upon how much money you have and what type of lifestyle you want to live. With all the advantages, however, it is easy to see why so many people are making the choice to retire somewhere besides the United States.