Retirement after years of hard work is a finish line many have been waiting for. A time to breathe, reflect, and dream about the life you want to live. Whether that’s relaxing in a hammock, eating gelato in Italy, or embarking on a new career, for many, moving abroad at retirement sounds like the perfect way to reap the rewards. Before you start filling up your suitcase, there are a few things to consider. Retiring abroad is a huge lifestyle, financial, and logistical decision. Here are a few things to keep in mind as you prepare to embark on your new life.
Get the Paperwork Out of the Way
Well, before you purchase that one-way ticket, however, you’ll want to do your homework on visa and residency options. In general, there are two categories of visas that would likely be available to U.S. retirees, depending on your specific situation. Most countries offer some type of retiree visa or passive income visa, which means you can qualify as long as you can demonstrate the assets, such as savings and investments, to produce the minimum income necessary to cover your expenses. The minimum amount varies from country to country, so that will be something to confirm.
If you are planning to work from abroad, you should also confirm if that’s allowable under your particular visa, or if it restricts employment to foreign nationals. Even if the job is for an American company, some visas frown on foreign employment, so it’s best to confirm the details up front to avoid any expensive legal upheaval.
Do Your Homework
Moving to another country means learning a new system and adjusting to a different lifestyle.
First, Medicare will not cover you overseas. Consider local or international health insurance plans. Many countries provide first-rate healthcare at a much lower cost than in the United States. In some countries, it may be feasible to pay for medical expenses out of pocket, but check to see if local hospitals are accredited by the Joint Commission International, a not-for-profit organization that certifies healthcare facilities worldwide. Verify whether there are English-speaking doctors and specialists, and ensure that your prescription medications are available. Many retirees in Israel have no problem getting quality healthcare, but some in Aruba prefer to travel to the United States to see doctors.
Cost of living is another big consideration. While many foreign retirement spots have a much lower cost of living, retirees still need to pay attention to tax and banking regulations. Social Security benefits can be deposited into a U.S. bank account, which you can access overseas. However, it is now more difficult to open foreign bank accounts under U.S. regulations. It’s wise to have both a U.S. and a local account. Retirees also need to file annual U.S. tax returns, no matter where they live. Currency exchange rates are another factor. Spreading your assets between U.S. dollars and foreign currency is one way to hedge against risk.
Top Retirement Destinations
Looking for your perfect overseas paradise? The latest Global Citizen Solutions Index shows Spain is the best country in the world. Spain ranked first for quality of life and healthcare, followed by strong performance in tax optimization and security. With a sunny Mediterranean climate, great infrastructure, and a friendly culture, Spain is a popular retirement destination for people from all over the world.
In sixth place was New Zealand, ranked first for security, acceptance, and integration. The natural beauty, English-speaking environment, and healthcare system make it attractive for its safe, relaxed, and natural living. While the cost of living is on the higher side, the stable and high standard of living in New Zealand more than makes up for it.
