Showing posts with label what to know before moving abroad. Show all posts
Showing posts with label what to know before moving abroad. Show all posts

Wednesday, January 24, 2018

Five Places to Retire Overseas - What to Consider

This week we have a guest post from Corey Thompson, a Texas attorney who specializes in estate planning and Social Security Disability law.  The subject he chose to cover in his post was overseas retirement.  This is a very timely article because hundreds of thousands of Baby Boomers are enthusiastically exploring the possibility of moving to other countries when they retire.

Recently, a number of articles have been published on the topic of overseas retirement.  In addition to the information provided below by Mr. Thompson, retirees should consider a number of factors before deciding whether or not to move to another country.  These factors would include potential U.S. State Department travel warnings, your willingness to learn a new language (which can be extremely important in an emergency), and your flexibility.  You are not going to be able to perfectly recreate your current American lifestyle in another country.  Are you willing and able to accept that many things will be different and, in some cases, less convenient than you are accustomed to here?

Retirees who move abroad also need to be aware they cannot use Medicare while living in another country.  They will need to investigate whether they can buy insurance or pay to belong to the national healthcare system in the country where they want to live.  Finally, they will want to take an extended vacation in the country before committing to living there.  During that time, they will also want to talk to a Realtor, attorney and CPA in the other country to learn more about meeting local residency requirements, purchasing or leasing property, and paying taxes.

Below is the guest post by Corey Thompson

Five Places to Retire Overseas

As the American population ages, a growing number of Baby Boomers are retiring overseas.  The Associated Press reported that from 2010 to 2015, international retirement rates rose 17 percent.  There are now at least 400,000 seniors who have left the United States and retired overseas, usually in an effort to make their dollars stretch further.  Those figures are expected to rise in coming years. The countries with the most expats are Canada, Japan, Mexico, Germany and the United Kingdom.  These countries are all good choices for someone considering living abroad.

Factors to Consider When Retiring Internationally

"Live and Invest Overseas" has put together a list of thirty possible retirement destinations which they have ranked based on a number of factors, including:

*  Cost of living
*  Infrastructure
*  Healthcare
*  Entertainment/recreation
*  Expat community
*  English spoken
*  Climate
*  Real estate affordability
*  Taxes
*  Safety

Top Retirement Destinations

With the above factors taken into consideration, when I looked over the list of recommended spots, the ones I suggest retirees consider when relocating internationally are:

Portugal's Algarve Region

The Algarve Region is commonly referred to as the "old world region" of Portugal.  This location scored the highest in the safety and healthcare categories.  English is a widely spoken language.  Best of all, the Algarve Region is home to 42 golf courses and 100 miles of Atlantic Ocean coastline.  The rent for a two-bedroom apartment is about $720 per month.  If you're worried about citizenship, Portugal offers two plans.  The first plan is the "Gold Visa Program." This program allows you to purchase real estate in Portugal, with the contingency that you stay in the country at least one week every year.  The other plan is called "self-sufficiency residency."  To become a citizen under this plan, you must have an income of $1,300 a month and stay in Portugal for six months per year.  Since the average Social Security income of American retirees is a little over $1,300 a month, many retired Americans would be able to take advantage of this opportunity.

Valletta, Malta

Malta is a small, but beautiful country.  In order to obtain residency, you must rent a house or apartment.  Two-bedroom apartments usually rent for around $915 per month.  Malta is also know to have a vibrant nightlife.

Mazatlan, Mexico

Mexico is one of the aforementioned countries and is home to a growing number of American retirees.  Many people like Mexico because of its close proximity to the U.S., making it easy to frequently return and visit family and friends.  Mazatlan is a city located on the Pacific Coast of Mexico and features twenty miles of beaches.  It is also home to an international airport, fabulous street food, world-class fishing, and a tropical climate. (Note: It is particularly important to note that in recent years, some parts of Mexico have received an official Travel Warning from the U.S. State Department.  It is always wise to check the State Department website before visiting or moving to Mexico,as well as other countries, and before traveling around any country once you have moved there.)

Abruzzo, Italy

The Abruzzo Region of Italy has been called by many "the most overlooked and undervalued" landing spot for American retirees.  Abruzzo is located in central Italy and features a climate similar to the northern half of the United States ... hot in the summer and cold in the winter.  In Abruzzo, it is estimated you could live on about $1,400 a month, which is within the budget of many retirees dependent on Social Security.

Saint-Chinian, France

Saint-Chinian is the perfect city for wine lovers.  The city is located in Southern France and is particularly well-known for the variety of delicious local wines.  It is more expensive than the other places listed here, but you can still live there comfortably for about $2,000 a month.

Can You Leave International Properties In Your Estate Plan?

The simple answer to this question is yes, you can leave international properties in your estate, although, there are a number of issues which will factor into the decision to leave your foreign property in your estate. You must take into consideration the taxation, whether you will need a will in both the U.S and the foreign country, whether that country will honor a U.S will, or whether you need an international will. An additional factor which should be taken into consideration is whether you should leave the property in a trust. For more information, it is advisable to discuss your specific situation with an experienced estate planning attorney.  (Note: You may need both an American attorney and one in the country where you own property.)

More Thoughts on Moving Overseas

The list of international places to retire could be much longer, depending on a wide variety of factors.  At the end of the day, it is up to each person to determine what they are looking for in a retirement community.  If you love golf, then perhaps the Algarve Region of Portugal would be your dream retirement location.  If you are looking for a large expat community, Mazatlan in Mexico may have everything you desire.  What is my advice to you?  Decide what you want, then spend time finding a location which will best meet your needs.

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About the Author

Carey Thompson has been practicing Social Security Disability and estate planning law since 2008, after graduating from Texas Wesleyan School of Law, now known as Texas A&M School of Law in Fort Worth, TX.  While at Texas Wesleyan, he served on the Law Review.  Prior to attending Law School, Mr. Thompson was a high school band director for four years, using his degree in music education from Michigan State University.  He is a practicing attorney in Tarrant County, Texas.

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If you are interested in more information about retirement planning, where to retire in the U.S. and abroad, Social Security, Medicare, common health problems and more, use the tabs or pull down menu at the top of this blog to find links to hundreds of additional helpful articles.

Watch for my book, Retirement Awareness: 10 Steps to a Comfortable Retirement, which is due to be released by Griffin Publishing in 2018.

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Photo credit:  Google images photo of Portugal.

Wednesday, November 12, 2014

Avoid International Problems When Retiring Overseas

Tens of thousands of Americans have chosen to move to other countries in retirement and most have had pleasant experiences, often living happily in gorgeous tropical or European locations.  The people who have had the most success are those who took the time to do thorough research and careful financial planning.

Recently I wrote a post called "Investigate Exchange Rates Before Moving Overseas."  However, the currency exchange rates are not the only issues that could affect your pocketbook if you decide to move to another country.  While most potential problems can be avoided or dealt with, it is important that you take the necessary steps to be assured that everything goes as smoothly as possible.

Factors To Consider Before Moving to Another Country

Have a realistic idea of the cost of living - While it might be possible to live very cheaply in another country, will you be living in a lifestyle that is comfortable for you?  One young couple we know who moved to Costa Rica recently spent $300,000 for a new, modern home in a gated community.  While they could live cheaper in other areas, they preferred the safety and modern amenities that were available in this neighborhood.  You need to ask yourself ... will I really be reducing my cost of living?  In addition, you need to factor in extra expenses, such as the cost of travel back and forth to visit family in the United States.

Make arrangements to receive your Social Security checks in your new country - Approximately 400,000 U.S. retirees currently get their checks abroad.  You can find out how to do this and whether or not the checks can be sent to your new country at  Once in your new country, the U.S. embassy or consulate can assist you if you have any problems.

Investigate the health care system and medical insurance in your new country - Will you have access to the specialists you need at a price you can afford?  Since you cannot use Medicare in other countries, can you buy into the national healthcare system in your new country or purchase private insurance?  Should you keep basic Medicare available for when you travel back to the U.S.?  Many people do, especially if they make frequent return trips or only live overseas for a portion of the year.

Another option is to selection a Medicare Advantage plan that will provide at least emergency coverage in foreign countries.  It is reassuring to know that part of your medical bills will be covered if you have a stroke or heart attack in your new country.

You are required to continue to file U.S. tax returns - If you have any assets in the U.S., or at least $10,000 in a foreign account, or any income coming from the U.S., or you are earning foreign income, you are required to file tax returns, even if you don't owe any taxes.  Failure to file the proper forms can result in a $10,000 fine and you can be arrested upon your return for felony tax evasion.  Make sure you cut all ties with the state where you have lived, too, or you could be expected to file state tax returns.  You may also have to file a tax return in your new country.  You need to check with an accountant in the country where you will be living to learn exactly what tax laws could affect you.

* If you plan to work in your new country, make sure you know the requirements - Will you be allowed to work?  Remember, you will also have to report any money you earn to the U.S. government as well as to the government of the country where you now live.

Set up a bank account in your new country - However, you may want to keep most of your assets in a U.S. bank where they will be less affected by currency fluctuations.

Consult an attorney before buying property in a foreign country - Some countries allow you to purchase property, while others do not.  In addition, a local attorney could help you avoid a real estate scam or other problems.

Have a local attorney look over your will, trust, power of attorney, etc. - Make sure your wishes will be honored in your new country and that your documents comply with their laws.

Register with the U.S. State Department's Smart Traveler Enrollment Program - This is important so the government can find you in an emergency.

In addition, some people I know who have owned homes overseas have told me that they enjoyed it most when they only spent part of the year there or only stayed for a few years.  In this way, they were able to still spend time with family and loved ones in the United States and not feel so isolated. 

In the end, the choice of whether to retire overseas or stay in the U.S. is up to each individual.  Whatever you decide, just make sure you have prepared carefully for everything you can and realize that some problems ... such as erupting volcanoes, hurricanes, earthquakes, floods, debilitating illnesses and other emergencies ... are things you will just have to deal with as they come.  After all, that's part of the adventure, isn't it?

If you are planning your retirement, you will also want to check out the tabs at the top of this article for links to hundreds of posts on a wide variety of retirement topics.

Sources and Reference Materials to Help You:

"Tax Guide for U.S. Citizens and Resident Aliens Abroad" at

"Before Relocating Abroad, Consider These 10 Guidelines" Where To Retire Magazine, September/October 2014.

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