Retiring abroad

Retiring abroad can let you live cheaply in an interesting place; you are not all that likely to actually find paradise-on-earth or the fountain of youth, but you might get close enough to enjoy yourself immensely. Retiring abroad is certainly not for everyone, but it may be worth considering for many. This article aims to provide the basic information anyone considering it will need.

There are two main reasons for someone to retire in a country other than where they spent their working life.

One is climate; people from colder places flock to the Mediterranean, the Caribbean, Southeast Asia and other warm regions, while others choose a dry desert climate because that is easier on asthmatic lungs or arthritic joints.

The other is saving money; a pension that is just a pittance in a relatively wealthy country may be enough to live well in a lower-income country, while a substantial pension or some good investments might let you live in luxury.

The lower costs may let you retire earlier, or take some time off as a sabbatical break in mid-career, or just live somewhere cheap while continuing to work.

Other ways to retire are briefly discussed in the last section of this article. Senior travel describes time-limited getaways for elderly people.

Some choose a nomadic retirement, travelling on their own boat, on cruise ships or with a mobile home. With some combinations of budget and destination, it is even possible to move around while staying in hotels; see digital nomad. However, most retirees will choose a destination, rent or buy a house or apartment and, at least mostly, live there.

There are many ways to choose a destination.

Many people stay reasonably close to home — Englishmen in Spain, Japanese in the Philippines, Canadians in Florida and so on — while others range further afield.

Some aim to be in the thick of things, choosing a major cultural hub like London or Rio de Janeiro, a highly developed tourist area like Cancún (Mexico) or Boracay (Philippines), or a trendy "jet set" spot like Ibiza (Mediterranean Spain).

Others aim to get away from it all, choosing a rural retreat, some relatively isolated place like Mauritius (Indian Ocean), a picturesque spot off the main tourist trails such as Vigan (Philippines), Flores (Guatemala) or Dilijan (Armenia), or a place that mostly gets domestic rather than international tourists such as Cox's Bazar (Bangladesh) or Lamu (Kenya).

Some choose a place to suit their interests — perhaps Queensland for diving, Rishikesh for yoga, or Austria for skiing.

Others choose a location that is itself interesting and can also serve as a base for exploring a region — perhaps Nassau for the Caribbean, Bariloche for South America, Singapore for Southeast Asia, Prague or Barcelona for Europe.

Some choose a region that is famously well-provided with some item of interest: Belgium or any of several nearby countries for beer, any of a dozen places including France, the California Wine Country and South Australia for wines, Argentina or Brazil for good cheap beef, various coastal or island destinations for seafood, and so on.

Some choose a place based on available entertainment. If you want to be able to catch major touring shows — whether your taste runs to the Stones or the Bolshoi Ballet — then you need to be in a major city or within easy travelling distance of one. Others choose London or New York for live theater, Nashville for country music, and so on.

Given a reasonable budget and a temperament that is at least mildly adventurous, it is possible to find a location to suit almost any taste. Often it will be possible to achieve several of the above goals in one place. Starting points for a search might be our lists of Previous Destinations of the month and Previously Off the beaten path featured destinations.

Settling down in an exotic foreign country is definitely not for everyone; there are many things to consider. For some, moving abroad was the best thing they ever did, while for others it was a complete disaster.

Culture shock can be a major problem. Exotic places and people can be fascinating, but they can also be most irritatingly foreign. Doing some exploration before moving in helps, but there may still be cases of "It's a nice place to visit, but I wouldn't want to live there."

For most people, it will be more sensible to take things slowly, rather than diving straight into a partly unknown culture. For example, instead of selling your home to move abroad, you might rent it out while you discover how a new country suits you. If all goes well, then a few years later you can sell the place back home; if not, you can return home or explore other destinations. It may also make sense to start your life abroad in a tourist town or expatriate ghetto, where life as a foreigner is easier, then consider other areas after a few years when your language skills and knowledge of the country are better.

Language can be a problem. In particular, tonal languages such as Chinese, Thai, and Vietnamese are often difficult for Westerners. Other languages, especially European languages, may be less difficult for an English speaker, but acquiring any language requires significant effort. Be aware that a similar language may have a more complex grammar, difficult pronunciation or odd spelling. See also our articles Talk and Language tourism.

There are popular retirement destinations where English is the main language, such as Bermuda and Belize. In others, such as India, Sri Lanka, Malaysia, Malta, Gibraltar or the Philippines, English is widely spoken but other languages are also quite important; you can get along with just English but learning some of the local language will make a long-term stay easier. In still others, such as Thailand, Indonesia or most of Latin America, English is less widespread and learning at least some of the local language is more-or-less essential for long-term residents.

When choosing a destination, consider the cost and convenience of travel in both directions. Being too far from friends and family is the single largest reason for people who have retired abroad to give it up and return home. In particular, some people find being a long way from their grandchildren very difficult.

An Englishman in Spain or an American in Mexico, for example, can easily get home now and then and might reasonably invite friends and family to visit. In Pago Pago, both will be more difficult. Note, however, that long distances are not necessarily prohibitive; anywhere with good airline connections may be okay. For example, an American in Paris or a European in Thailand is a long way from home, but many flights are available and some are quite cheap. See our articles on air travel on a budget and the "Get in" sections of country articles for details.

The Wikivoyage articles on countries, regions and cities provide a good starting point. For some destinations, see also tips for travel in developing countries. We provide links below to government sites with visa information.

A web search on the country or city name plus "expat" (short for expatriate, someone living outside their own country) will often turn up sites with local information. The best of these are very good indeed, a prime information source. However, it takes some sifting to extract the good information; some are basically promotional sites for various businesses, loaded with biased information, some are one-person blogs which may have quite a limited scope, and even the good ones may have some clueless or crackpot participants. It's also good to be aware of when the person writing visited the location. No matter how good the information may be, if they haven't visited in years, it may be outdated and no longer reliable. This is particularly problematic in travel writings from developing countries where things are constantly changing.

Magazines and websites such as International Living, International Citizens, Transitions Abroad and Expat Exchange cover expat life in general. Others such as Best Places In The World To Retire and Retirepedia are specifically about retirement and still others, such as Retire Asia and Viva Tropical for Latin America are about specific destinations.

There are also government sources for information. Some governments provide information for their citizens considering retirement abroad, for example the US, the UK and Canada. For information on destinations the US State Department has "background notes" for many countries, and the Canadian government provides "country insights". These are mainly oriented to international business and trade. The destination country's embassy in your home country or your home country's embassy at the destination may also be helpful.

You can get some idea about a country by looking at statistics and indexes, perhaps starting with Wikipedia summaries such as per capita GDP and average household income as cost indicators. Follow their links to the data sources for more detail. See their list by Social Progress Index for a more general idea of living standards. Indicators for safety levels include Wikipedia's page for murder rate, and the Global Peace Index. Other numbers of interest include the Democracy Index, the Corruption Perceptions Index, the Press Freedom Index, the Global Integrity Report, and the Gini index for the degree of inequality of income in a society. Mercer rates cities worldwide by quality of living and by infrastructure. Expatistan provides cost of living comparisons for almost any pair of cities.

A short-term stay in most countries generally only requires an easily obtained tourist or business visa; for many destinations and many passports, this can be obtained on arrival at the airport or other entry point, or can be applied for on-line over the Internet. However, to live long-term in almost any country, almost any foreigner will require a specific visa. Our country guides concentrate on visa requirements for shorter visits but may have some relevant information. Follow links there for government sites with authoritative information, or consult an embassy or consulate.

To live abroad, you probably need multiple bank accounts, at least one back home and one in the destination. Ideally, both banks should be chosen partly because they have plenty of international branches; it does you little good, for example, to have a bank account that you cannot draw on in your new home. As a general rule, the major banks are better for this than smaller regional banks, but there are exceptions in both directions.

HSBC is one of the world's largest banks (Wikipedia says 7th or 8th), and a popular choice for expatriates because they have many international branches and some services specifically designed for expats. They were originally Hong Kong Shanghai Bank, set up in the 19th century to serve the China trade, so they have considerable experience with international banking. Headquarters are in London, but they advertise themselves as "the world's local bank" and have 6600 branches in 80 countries.

Major credit cards — MasterCard, Visa and, to a lesser extent, American Express — are widely accepted around the world. However, there are local variations; see country articles for details.

If you are moving large amounts or doing many transactions, it pays to check the costs. You might get six different combinations of exchange rate and service charges moving money in six ways — exchanging cash, exchanging a traveller's cheque, doing an electronic funds transfer between your home and remote banks, using a funds transfer service such as Western Union, using a credit card, and doing an ATM withdrawal of local currency with a foreign card. Which is most advantageous will vary depending on where you are and which bank you use on each end of the transaction. In the worst case — the exchange rate is not good, both banks charge a service fee and you are limited to small transactions so you pay those fees many times — you can lose about 10% of your money by making a bad choice here. See also our article on money.

More generally, be aware of and somewhat cautious about exchange rates. For example, the Canadian dollar dropped from over 95 to about 80 US cents in just a few months around the start of 2015, and the British pound dropped about 10% in a day after the Brexit vote; such changes can have large effects on expats who are paid in one currency but have their expenses in another. Your planning, either simply for retirement or for investment, needs to take account of this risk. Consider trying to have some income or savings in a form that follows fluctuations in the local prices.

There can be complications. Some countries — Thailand, China and India, for example — have legal restrictions on exchange of foreign currency or on import and export of the local currency. Some retirement visas, such as the Philippines, require you to exchange a fixed amount monthly at government-approved banks. It is not a problem in the Philippines but in some places the official exchange rate may not be to the traveller's advantage. There may also be complications if the governments involved aren't on good terms; funds of citizens of a "non-friendly" country may get seized if a conflict escalates. Don't keep too much of your funds in a country that might get affected.

Taxation is often complicated, so for anyone with substantial assets or income getting professional advice is almost certain to be well worth the cost. An investor will likely need accountants in both home and destination countries plus at least one lawyer. This section tries to cover the basics, but it should definitely not be your only information source. Even if your assets and income are small, you probably need to at least check the rules for both countries by reading government web sites and/or making inquiries at the tax offices.

In most cases, people on retirement visas enjoy a tax exemption in the destination country. Investors, however, are generally not exempt and must plan accordingly.

Taxation by the home country may be an issue. American citizens and resident aliens are required to file and are taxable by the US on worldwide income even if living abroad. There is a Foreign Earned Income Exclusion (form 2555) that allows an American living abroad to avoid tax on up to $100,000 a year earned abroad, and a Foreign Tax Credit (form 1116) that reduces US tax if you are taxed abroad. In many expatriate communities there are some mostly-retired accountants who supplement their income by helping Americans with this, and a company called Bright Tax offers US expat tax services worldwide.

Other countries generally do not tax on worldwide income if you do not reside in that country, but most will apply tax if you have an income in the country. For example, take a Canadian who has $20,000 a year of income from renting out a house in Canada, but lives elsewhere. If they live in a country such as the US which has a tax agreement with Canada, then the Canadian government takes a flat 15% of the Canadian income, $3000 in this case. On the US tax return, they report the $20,000 as income and deduct the $3000 from the US tax due as tax already paid. If they live in a country which has no tax agreement with Canada, then the Canadian government takes a flat 25%.

As for most taxation, enforcement on these can be draconian; should an expatriate fail to pay these taxes, their agent in Canada becomes legally liable for the entire amount and both the expat's and the agent's bank accounts can be seized. Also note that in some countries, including Canada, a pension that is small enough to escape tax if you live there becomes taxable at 15% or 25% if you become a non-resident.

Depending on a whole complex of factors, it may be advantageous to have some of your money in a tax haven, which need not be either your home country or the one you live in. For example, an Englishman living in Thailand might have a Channel Islands account, and the Canadian in the example above might consider selling the house and investing the proceeds through a Hong Kong stockbroker. On the other hand, it might be better to mortgage the house and do something clever with the proceeds, since the mortgage interest would be a deductible expense for the taxation. Note, however, that Americans are required to report foreign assets over $10,000 to the IRS and many foreign banks (under threat of having their US business restricted) co-operate and report to the US government on American-owned accounts. There is a political pressure e.g. in the EU to implement similar schemes, and "safe" illegal arrangements can turn out to be very much unsafe.

Many foreign retirees buy property – a home or a business – abroad, though others find it simpler and lower-risk to just rent. This section covers buying a home; buying a business is generally more complicated and the rules vary by country, so we do not attempt to cover that.

When choosing a place, you may need to allow space for whatever visitors you expect and to consider getting furniture that gives you flexibility in accommodating visitors, such as a couch that folds out into a bed. Or perhaps just choose a place with a good cheap hotel nearby.

In some countries, there are legal restrictions on foreigners buying property. For example, in Thailand or the Philippines, a foreigner cannot own land but can own a condominium. In Indonesia, a foreigner can buy a place, but only above a minimum price which varies by region. It is fairly common to avoid the restrictions by putting the place in the name of a local lover; typically this works just fine, but it can get quite messy if the relationship goes sour and they are the legal owner of the house you paid for.

In some of the retirement visa deals, buying property gets you off the hook on the cash deposit. For example, for a Philippines visa you must put $10,000 in a local bank and leave it there as long as you stay, unless you buy property. However, if you spend $50,000 or more on real estate that complies with government rules (not a place that is still under construction, for example), you get the deposit back.

It is absolutely necessary to be sure you get good unencumbered title to whatever you buy. Without that, you could be forced to move without compensation, or to pay to clear up a problem. Sometimes title problems occur due to outright fraud, a crook selling a property they do not own; be suspicious of anyone who offers an exceptionally fine price and wants to close quickly. Or there may be several people with a legal claim to a property: more than one child for the parents' house once mom and dad are gone, ex-husband and ex-wife, and so on; an unwary buyer may be caught in the crossfire of a family feud. In some countries aboriginal land claims may conflict with what the settler-dominated government thinks is the case, and again an innocent buyer can be caught in the crossfire. In many countries a contractor who does work on a place and is not paid can register a "mechanic's lien" against the property; no-one can get clear title without paying them off. A mortgage lender also has a claim that must be paid before title is transferred.

What you need to do about possible title problems varies by country; your first step should be to seek expert local advice. In many places it is enough to hire a good lawyer to handle your purchase; they will check the title as part of standard procedures, and will ensure that all liens or mortgages are paid off before or at closing. In some places you can buy title insurance which protects you if unforeseen problems crop up later, and this is sometimes a very good investment.

In planning a move, allow for shipping costs and consider which things might be better bought at the destination than shipped. As a general rule, furniture and appliances are better bought on site than shipped. This reduces shipping costs, avoids difficulties with different electrical systems, and often means you have a warranty that applies where you are. However, there are plenty of exceptions; you need to work out which of the exceptions apply to you.

Shipping costs can go up to well over $10,000 for a long-distance move of a big load using a full-service company that handles packing and does door-to-door delivery. Typically, though, they are much less. Paying airline excess baggage fees is one of the most expensive ways to transport stuff and should be avoided if possible. Shop around; there are some good deals out there, though it is necessary to be cautious about cut-rate vendors. Consider companies that serve an immigrant community; many overseas workers send stuff back to the old country and it is generally small loads, so these companies are usually best if you have a small-to-medium load going to a country they serve.

If there is some way to reach your destination overland, and you are confident you can make the trip, you will be able to carry a lot more than the rather low weight limits on airlines. If you live in Britain and want to retire in Southern Spain, loading your car with your stuff and simply driving there (using a ferry or the Chunnel) is certainly doable. It may even be worth renting a larger vehicle or putting a trailer on the car. If your origin is Japan and the destination Europe, it's probably not worth the trip round the world overland, though.

If you have items of any sort which are small, high-quality and useful — say kitchen pots and knives — by all means bring those; replacing them is likely to be uneconomical, and if you are used to good tools then using lesser ones can be unpleasant. Larger items are a tougher call — a fine sound system may be worth bringing even if the speakers weigh a ton and the voltage is wrong, but again it may not be. If you have good art or craft items — say paintings or carpets — consider bringing them along; they will make the new place feel much more like home. On the other hand, also consider giving or loaning them to family and friends who you know will appreciate them.

Books are heavy so transporting them can be a problem but bringing at least some of them is essential for many travellers, especially when planning for a long-term stay. If you are sending a freight shipment for household goods, then including books in that will be the cheapest way to transport them. If you are travelling light and want to bring books, the post office may be far cheaper than airline excess baggage charges; some countries' post offices have a special cheap rate for mailing books. Acquiring an e-book reader is also an alternative worth considering.

Health concerns are important, especially with advancing age; availability and cost of good care are always factors in choosing a destination. In some cases, they may be the deciding factors; see medical tourism. While the cost of healthcare is often lower in developing countries than in developed ones, the standard of care will sometimes not be up to what you are used to at home. On the other hand, it may sometimes be better; for example, lower labour costs might allow a hospital to have a better ratio of nurses to patients. Also, while professional fees and costs for common medicines are generally lower, costs for things that need to be imported, such as dental implants and some drugs, may be higher than at home.

You may need vaccinations or other precautions such as anti-malaria medication. Consult a doctor with expertise in travel medicine, or visit a travel medicine clinic, well before your planned departure.

Bring your medical records; your doctor at the destination will need them. If they are in a less known language, you might want to get them translated at home.

Health insurance should be part of your plan and budget. In some countries, people on a retirement visa are eligible for, or even required to enroll in, the destination country's health insurance scheme; this may be useful, but you might need other insurance as well. Some countries have added new health insurance requirements due to COVID-19; for example Thailand and the Philippines now require insurance (and vaccination, and sometimes testing).

If you live abroad, you may no longer be covered by your home country's government health insurance system and if you have a private plan, it may not cover everything you need abroad. Whatever insurance you have, or will get in the new country, it is a good idea to review it when moving to see if you need to make additional arrangements. In particular, many policies do not cover evacuation in an emergency or problems that may crop up while you are outside your country of residence.

Insurance coverage may not be restored immediately if you return to the home country. For example, Canada has "universal" health insurance, but you must be resident in a province for three months before you are covered. Without other insurance, a sick person might be unable to go home because he could neither afford to pay for treatment himself nor survive three months without it. An exception is that if you are employed abroad, then you can keep the Canadian insurance valid for up to five years, but this requires an actual job in the destination country; it does not apply if you are retired or working over the net.

Communications become vitally important when you live overseas. Low-quality, expensive or unreliable communications systems are a problem in some areas, and censorship is a major difficulty in others.

Consider having a backup communication system to use if other things fail. For example, both phone and Internet connections might stop working if an earthquake took out an undersea cable or the government went into a panic about some unrest in the country. If that is a risk where you are going and communications are critical for your life or business, be prepared. Depending on your exact situation, it might be enough to have a short wave radio or satellite TV to get international news broadcasts. Others might need two-way communication as with a ham radio set-up or a satellite phone. On the other hand, some may be fine with nothing at all.

If your retirement plans include a vehicle, perhaps an SUV or a sailboat, consider equipping it with a communications system that can double as backup for your home system.

Wikipedia has a list of countries by Internet speeds. See also Internet access, Telephone service and the "Connect" sections of country articles for more information.

This article covers moving abroad to retire. There are other ways to manage retirement; we try to list most of them in this section, but make no other attempt to cover them:

Seasonal migration works well for birds, and sometimes for people. Some retired people maintain two homes, perhaps spending summers near family and friends and winters somewhere warmer; they are often called "snowbirds" in the Americas, while "swallows" is used for Europeans who winter in South Africa. Others live mostly in their home country but travel a lot in winter. See also vacation homes.

Grey nomads live a mobile post-retirement lifestyle; this lets you see more places and also gives you the option of migrating with the seasons. Often this involves travel with a mobile home or by boat but, with enough money, it is also possible to retire (or just to winter) as a passenger on cruise ships, coming ashore only occasionally to change ships or to visit friends and family. Another variant is to have both a house in some interesting place abroad and a boat or vehicle for exploring nearby areas.

The book and website The Four-Hour Work Week introduce "lifestyle design" techniques, including the notion of taking a series of "mini-retirements" spread out through a career rather than waiting for one big retirement late in life. The site Retire Early Lifestyle also has some online info, and promotes a book The Adventurer's Guide to Early Retirement.

Quite a few people choose to live abroad without retiring. Arguably, this makes for a more interesting life and it can certainly save money. One way to do this is to work abroad, but it also works well for people who live off investments or who earn money elsewhere, for example by running an Internet business or doing really long-range telecommuting. The classic example is Arthur C Clarke (author of 2001: A Space Odyssey, among other things), living in Sri Lanka while collecting book and film royalties in hard currency.

For aging hippies and others who really want to get away from it all and go back to the land, the classic reference is the Whole Earth Catalog. Other sources include Off Grid Info and Appropedia, an appropriate technology wiki. Also, the Global Village Construction Set offers "an open technological platform that allows for the easy fabrication of the 50 different Industrial Machines that it takes to build a small civilization with modern comforts."

If you have plenty of money, there are even a magazine and web site devoted to marketing private islands around the world. Prices start around a hundred thousand dollars for an undeveloped island in backwoods Canada and there are a lot of nice-sounding properties in the half million to five million range, mostly with an interesting location and a nice house. At sky's-the-limit prices, there are properties with prime locations and very luxurious housing; many include businesses such as resorts and marinas.