Retiring abroad has become a popular trend for many Americans. There are many reasons to retire abroad, including a lower cost of living, a slower pace and sandy beaches. But before you move, there are some things to consider. Here’s a checklist of practical steps to make your retirement abroad a reality. You can also work directly with one Financial Advisor who can help you develop a step-by-step plan to retire in the place you want.
Visit the country first
Perhaps you are eager to move to you retirement refuge. You may have read about it online and felt it sounded like the perfect fit. But the reality may be different. There may be people who have had a really great experience, but that doesn’t mean yours will be the same. During your visit you can get a general idea of the landscape, the accessibility of the city and the nearby facilities. If you are thinking moving Don’t just visit this place for a weekend – consider visiting for a few weeks or even a few months.
Rent before buying
After visiting the place you may want to move to, the next step is not to move buy a house or apartment but rent it first. Even if you’ve been visiting for a few months, you might later realize it’s not the right fit. This is very similar to moving to a new state in the US because you need time in the area to know which place is right for you in the long run.
In some cases, it can take six months to fully determine how you feel about a place. During this time, you may also decide to keep your home in the US if you happen to own one here. If you have family obligations that could take you back to the United States, rent will make it easier to return if necessary.
Find Health Coverage
Health insurance can be one of the biggest obstacles for people who want to retire abroad. For example, Medicare does not pay for healthcare abroad, so you may need health insurance for the country that will be your destination. At the same time, you may want to keep paying Medicare in case you ever return to the US
While you may be able to find health insurance from a US-based company that will cover you in the location of your choice, you may need to research how locally insurance works where you go. Some countries have care that is affordable enough that you don’t need insurance and can only pay on an ad-hoc basis, while others may offer you certain benefits if you buy real estate in the country.
Plan for taxes
Taxes can be another major pain point for those looking to retire abroad. If you want to remain a US citizen, the federal government expects you to continue paying taxes even if you live abroad. This can result in so-called “double taxation” if you also pay taxes in the country of your choice. However, the US government does have one exemption from income tax abroadwhich allows you to exclude worldwide income up to a certain amount.
Many countries will also give you a long-stay visa that does not require you to pay taxes if you meet the requirements. This usually means that you will not earn money in the country and can demonstrate that you have enough money to support yourself or you and your partner.
Consider recreation and social activities
It’s important to have time for recreation and social activities, especially for retirees, who often don’t spend time socializing with people in the office. While there are likely opportunities available wherever you go, they may differ from what you’re used to. Other cultures may like different activities or watch sports that you are not familiar with. Ask yourself if you can see this becoming something you participate in every week or if they are just too different.
Plan the transportation you need
How easy is it to get around in the place you are considering? Are there sidewalks and bike paths that make it accessible to everyone? If you are used to driving in the United States, will you buy a car or opt for public transport?
In certain parts of the world, gas is much more expensive than in the US, especially in European countries. Mobility is crucial to maintaining a high quality of life, so you want to know how you get around before moving abroad.
Run the numbers to check if you are fit to live in the area
You also have to be sure that you can do it afford moving abroad. Fortunately, Americans have a bit of an advantage here because it’s the 15e most expensive country in the world, according to Numbeo. But if you want to live in a place like Switzerland or Singapore, you’ll find that your costs go up, not down.
And remember, moving can be quite expensive. Airline tickets, additional taxes, health insurance and storage are among the costs you may incur when moving abroad. So it’s a good idea to run the numbers to see if you have the budget for a move abroad.
It comes down to
Retiring abroad is a big decision, but it is becoming increasingly popular. In some cases, the cost of living can be lower and you can soak up the sun on a pristine beach. While retiring abroad can be a good decision, first make sure it’s the right choice. You can do this by visiting and renting before buying. Also see if the country has everything you want, such as recreation, transportation and social activities.
Tips for retirement
A financial advisor can guide you through important financial decisions, such as determining your investment strategy and even managing your wealth. If you don’t have a financial advisor, it shouldn’t be difficult to find one. SmartAsset’s free tool matches you with up to three vetted financial advisors serving your area, and you can interview your advisor matches for free to decide which one is right for you. If you are ready to find an advisor who can help you achieve your financial goals, start now.
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