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Retiring overseas: It's more than a matter of money
Older Americans are increasingly retiring in a foreign country. But it's not for everyone, so here's an introduction to see if it might suit you. - photo by Jeff Wuorio
Jackie Lange is a Texan who now lives year-round in Panama. But hers is not a story of a fresh-faced kid seeking her fortune in a foreign land.

Lange, 60, retired to Panama some five years ago. And the reasons are plentiful.

"It is the best decision I have ever made," said the former real estate investor. "I live a much better life for less money in Panama. I live in Boquete, which has weather in the mid-70s, and the mountain views are spectacular!"

Once an outlier in retirement planning, moving to a foreign country is becoming increasingly popular, based on the hundreds of thousands of Social Security checks the government sends overseas. Its understandable among the advantages are drastically lower costs of living, affordable health care and an opportunity to experience the unusual and exotic.

Even a decade ago, it was still considered an outside-the-box idea, said Kathleen Peddicord, founder of the publishing group Live and Invest Overseas. Todays retiree generation is more interested in it than any generation before.

Overseas retirement can be a difficult topic to quantify. The Social Security Administration now sends more than 600,000 checks to retired expatriates, up 57 percent from 2000, according to Peddicord.

Id estimate that the number of Americans retired overseas is multiples of that, including retirees who spend part of each year in another country, she added.

In addition to lengthening life expectancy fast approaching an average of 80 years older Americans have a growing interest in and comfort level with an environment that prior generations might have wholly rejected. Todays retirees are better educated, better traveled and healthier than any generation before them, Peddicord said.

But retiring overseas isnt a one size fits all proposition. Its essential to know your limits, do as much advance homework as possible and approach the idea with an open mind.

A matter of money

While it may not (and perhaps should not) be the primary driver to consider overseas retirement, cost of living can prove a significant consideration.

The Employee Benefit Research Institutes 2015 Retirement Confidence Survey found only 22 percent of participants feeling very confident about having enough money for retirement.

With finite resources, a growing number of retirees are doing the math to see where their dollars go the furthest and the answer is frequently outside the United States. For instance, consumer prices in Mexico City are some 53 percent lower than San Francisco; rent, nearly 84 percent less expensive in Mexicos capital, according to the cost-comparing website

A retiree today has many years of retirement life to fund. If his cost of living is $3,000 per month in the states, the math may not work, said Peddicord. But, a budget of $1,500 per month is enough to live a comfortable and rich life in many places around the world. Instead of scraping by and making do, the retiree can reinvent his retirement into the adventure of his lifetime.

Affordable health care is another plus. Subsidized national health care is frequently available, and foreigners are often eligible.

"In Panama, I was able to get health insurance, which covers me anyplace in the world, including the U.S. or Panama," Lange said. "A routine doctor visit is only $10. A specialist doctor is $40 without insurance. I've had two eye surgeries in Panama. My doctor was trained in the U.S., speaks perfect English, and the hospital was high-tech."

Money isnt the only factor

However alluring finances may be, they shouldnt be the only compelling reason to pack up and go. If a countrys lifestyle and culture are simply too exotic or unfamiliar, financial affordability will do little to offset discomfort with your surroundings.

If the adventure of getting to know and assimilate into that other culture and those other ways of doing things isnt one of the main reasons for your move, you wont be happy no matter where you move outside the U.S., said Dan Prescher, co-author of International Living Guide to Retiring Overseas on a Budget. You need to move to a place primarily because of your heart rather than your wallet.

Some of those differences may seem rather trivial, such as unreliable Internet service. Others, such as the necessity of learning a new language or adapting to unusual food (guinea pig is popular in Ecuador) may be rather unnerving. Consider, too, the expense of traveling back to visit the United States or the mechanics of moving money in and out of a foreign country.

If the reasons are strictly financial or weather related if you simply want a less expensive lifestyle or you never want to shovel snow again consider finding a less expensive place with better weather in your home country, said Prescher.

Is it a fit?

One of the first steps to determine whether overseas retirement is for you is to take a personal inventory. Candidly gauge your comfort level of living in a setting with significant, day-to-day differences.

Only you know if you can tolerate the novelty of living overseas, said senior editor Suzan Haskins. Do you love adventure? Thrive on cultural differences and arent thrown by the challenges of those? The idea of living overseas is for people who love going through life without a roadmap. Theyre independent types who like figuring things out for themselves.

One approach is to identify those lifestyle features you value and those you can do without. For instance, is reliable mass transportation a must or are you OK with spotty service? Is the health care accessible and adequate for your needs? Peddicord recommends pinpointing two or three lifestyle issues that youre unwilling to forgo. If you have to give up those, consider another destination.

In addition to researching any country of interest, plan on spending time there ideally, when conditions are less than idyllic.

Try to stay for a few months at least, and do it during the offseason when tourists dont usually come when the country is having its rainy or dry or windy or hot or cold or buggy or cloudy season, he said. Stay long enough to find out what its like to shop there, cook for yourself there, try to find the products you want there, try to get the services you want there. In other words, try to live like a local for as long as possible before committing to a place.

Lastly, before working out the logistics of moving overseas (and they can be extensive), dont ignore your instincts, Peddicord added.

No amount of research of any kind can substitute for showing up in a place and just letting it sink in with you. Often youll know within 24 hours of arriving in a place if its somewhere you would be happy, she said. Pay attention to your gut reaction above all else. If you just dont like the place for no reason you can identify, fair enough. Move on to another option.