Have you ever dreamed of spending the rest of your days in a tropical paradise? Did you ever want to escape the harsh cold of winter and enjoy almost perpetual summer sunshine? Many Americans dream of retiring to another country, and it is a no-brainer.
While retiring abroad can be seen as living off a life-long dream, it can also be considered as saving your retirement. It was undoubtedly a retirement-saver for Edd and Cyntia Staton, whose investments suffered during 2018. The move to another country with a much lower cost of living allowed them to enjoy their retirement more.
Retiring to another country can be a way to live out your dreams, or it can be an economical move. Whatever your motive is, the steps that you need to take are the same. From deciding where you want to live to taking care of your properties such as selling a business that you own, here’s what you need to do.
1. Know Where You Want to Live
Many people have an idea where they want to live from their travels and because of the experience of family and friends. When choosing the place where you want to live, you must know what lifestyle, climate, and culture will work for you.
Even if you already have a country in mind, there are still decisions that you need to take. Do you want to live in coastal areas? Do you want to live more inland but still want some privacy? Other questions you need to ask include:
- What is your expected living costs?
- What are your property options?
- Are healthcare services accessible?
- Do you need to learn a new language? Do people speak English?
- Can you easily travel back for family emergencies?
- What is the political climate in your chosen country? Are there signs of unrest?
2. Check Visa and Residency Requirements
Not all countries have the same immigration and residency laws. Some states allow for easy yearly renewals, while some only allow three months of visa validity. You are primarily considered a tourist, and you will need to go through the legal process of applying for residency. The requirements are different for each country. Some countries will not require you to have a retirement visa and will allow retirees without formal citizenship.
When you apply for retirement visas, make sure that you have the required documents in place. If you fail your application, you will have to repeat the whole process. Ensure that you have your marriage license, birth certificate, and proof of income. You can apply for retirement visas at the local immigration office.
3. Ready Your Money
You do not want to close your bank accounts in the US. Enroll in online banking so you can still have control over your financial accounts abroad. Have your statement of accounts and other correspondence sent to you via email.
You can still use your US accounts for your Social Security checks and to pay for your credit cards. Prepare yourself for foreign transaction fees when you withdraw your money. If you want to set up a local account, you will need to file documents to comply with the Foreign Account Tax Compliance Act (FATCA) to avoid problems with the IRS.
4. Learn the Language
Even if English is the second language of the country that you chose, learning the local language will still be advantageous for you. Learning the language will allow you to be more functional. At the very least, knowing the language will enable you to make new friends.
5. Take Control of Your Healthcare
You cannot use Medicare if you live outside of the US. When you retire to another country, you will need to insure yourself for medical expenses. You can apply for local health insurance products, or you can consider global medical insurance.
However, you might want to retain your Medicare, along with Medicare Part B and Part D insurance. You might want to move back to the US later on, and if you drop your existing coverage, you will have to get them again at higher premiums.
6. Take Care of Your Property
If you own any real estate property, you have the option to sell it or turn it into an investment. Having earning investments in the USA can affect your tax situation in your chosen country for retirement.
If you own and manage a business, you might want to sell it before you move. Seek the help of a reputable business broker who will help you find buyers for your business at a reasonable price. At the same time, focus on your retirement plan and the continuity of your business as well.
Retiring overseas is becoming more and more common now. It is an exciting adventure to mark your new life. If done with due diligence, your move can be smooth and hassle-free.