(“Five Good Reasons to Consider Retiring Abroad” was originally published by The Costa Rica News, January 13, 2013)
Even in the best of times saving for retirement is often a monumental and difficult task, now with middle class opportunity shrinking, economic “cliffs” and austerity measures, it can be not just daunting but scary. Many Americans are starting to look at options to make their finances for retirement more assured. Here are five hard facts on retirement and how living abroad can provide viable solutions.
- Americans live for approximately 19 more years after retirement. This represents 20-25% of your entire life and further, approximately half the population will live longer than average life expectancy. Many Americans (especially baby boomers) have realized that apart from declining middle class opportunities, a potential bankrupt social security system and other economic disasters and woes, their savings are simple not going to last. Many have discovered that living aboard can significantly increase their odds of having sufficient money in their Golden Years.
- Real estate values. Many retirees are expecting to cash in on their number one asset, their home/property. The survey conducted by the Professional Risk Managers’ International Association for FICO found that home prices in the united Sates are unlikely to recover before 2020 and mortgage defaults will persist for years, says a survey of bank risk managers. The report, Emerging Trends in Real Estate from the Urban Land Institute, predict above-average growth for Latin America, well ahead of that for the United States and Europe, and other survey’s from across the global predict Latina America and specifically Central America, will see significant growth in real estate value, as more and more investors jump into the largest emerging market on the planet.If you are looking at improving your asset value, living abroad on your own real estate is increasing attractive.
- Medical costs will continue to rise, as well as your need for medical attention. It is a well known fact that US medical costs will continue to rise as will insurance costs. The aging population in US will also require more medical treatments as they age. It is also a fact that medical and dental treatments and procedures in places like Costa Rica will save you from 30% to 85% compared to the USA.
- Currently, the average Social Security retirement payment is just $1,220 a month. How far does $1220 go? Not far in North America. There are several areas in Central America, like Costa Rica where $1200 covers your monthly cost of living expenses, rent utilities, food and even leaves a little extra. For example in Costa Rica, outside of the densely populate urban centers or tourist traps, a nice 2 or 3 bedroom house is around $400/month, utilities including cable and internet will run you around $150/month, food is$450/month approximately.
- The average cost of an assisted living facility is approximately $40,000 a year in the U.S. Projections estimate that about 3 million US expats will join the million+ already in Mexico and Central America within the next 10 years. Other estimates place the number closer to 10 million by 2025. That, added to the shortage of affordable assisted living facilities in the US, creates a huge opportunity for investors and developers. When you search the news online you can find numerous investors, developers and existing assisted living facility businesses already moving south of the border, to take advantage of cheaper development costs, lower cost of living, less expensive but still highly skilled labor, and the growing number of baby boomer expats moving to Central America. Living abroad for retirement has become a reality for many Americas and is projected to become a major consideration for the baby boomers population which are now hitting retirement age at a rate of 10,000 per day in the US.
- So What Would It Cost ME to Live in Costa Rica?
- Our 2014 Cost of Living Summary
- Paul’s Monthly Tip to Live for Less in Costa Rica: Don’t Buy a Car
- Paul’s Monthly Tip to Live for Less in Costa Rica: Taking the Bus
- We always recommend buying Real Estate $150K & Under
- America is No Place to Get Old In