Welcome to our RetireForLessInCostaRica.com Newsletter!
In this month’s issue:
- So, what’s up with the Yeatmans? Our monthly update to answer the #1 question people ask us, “What do you DO all day?”
- Paul’s Monthly Tip to Live for Less in Costa Rica: Speak Spanish – Save Money
- Featured Speak Spanish Video: How to Bargain in Spanish
- Paul’s Monthly Weather “Report”
- Feature Article: 11.75% Colones CDs: Answering Your Questions
- What’s New on the Website – New Feature: Translate Our Website into Any Language!
Is January really over already? Seems like it just flew by! I actually have to take a minute to think…what DID we do all month??
Well, first of all, we had our beach days at Playa Doña Ana – three of them. The difference in January was that the Costa Rican kids were on their summer vacation. They are off from the middle of December to around February 10th. This means lots of Tico families at the beaches — lots of kids, dogs, and fun. Because we go during the week, the beach wasn’t overcrowded, but on weekends, when parents are usually off of work, we hear the parking lot is packed and every picnic table is taken.
We are always greeted with smiles from the people who work there as well as the Tico beach-goers. It isn’t unusual to see three generations of a family enjoying the beach together. Family is very important in Costa Rica and grandparents are both valued and respected. Children generally are well-behaved and happy. And that all contributes to the wonderful time we have when we visit Playa Doña Ana.
We also organized a couple of trips to Tortuga Island. Early in the month we had a group of 15 and then just the other day had a group of 30, most of whom were employees and family of a local veterinarian. Paul went snorkeling both times and had a blast. The water was crystal clear and he was able to see lots of fish and coral, except for that piece of coral he cut his foot on. Ouch!
We already have two more trips scheduled to Tortuga Island…one on February 5th and the other on March 3rd. What a great way to spend the day!!
Serving the Community
We continue to be busy as Steering Committee members of the Community Action Alliance. In January, we held a seminar featuring representatives from the U.S. Embassy in Costa Rica. The first hour was directed to Expats and focused on services offered by the U.S. Citizen Services Department in the Consular Section of the U.S. Embassy. In addition to giving us information, they also provided Voter Registration, Passport Renewal, and Notary Services that day, of which many people took advantage.
The second hour was aimed at Costa Rican citizens, with the goal of demystifying the U.S. Visa application process. The seminar provided an overview of Work and Tourism Visas and was conducted entirely in Spanish. Over sixty Ticos attended this session and our Embassy representatives did a great job answering all of the questions they raised. Afterwards, the Embassy folks told us that this was the best organized event they’ve done in Costa Rica.
Only in Costa Rica
We spent a Sunday driving to the Pacific Coast to hear our friend, Joe Anello, and his jazz quartet perform at Outback Jack’s Restaurant near Tárcoles. They play there every Sunday, so if you enjoy jazz and live in the area, it’s a great way to spend a Sunday afternoon.
But before heading over the the restaurant, we spent some time in Jaco, looking for boogie board flippers for Paul, and we saw a couple of things that made me say, “only in Costa Rica!”
The first was while we were parked on the street and I noticed a couple of signs that seemed odd next to each other. Maybe it’s just me, but it just seemed wrong to see a sign advertising ceviche (a local dish of raw fish or shrimp marinated in lime juice which “cooks” it) next to the Jaco Aquarium:
Then, that same day as we were leaving Playa Hermosa, we came upon a street we thought was blocked to traffic. We sat there in a car for a moment, trying to decide what to do when the Ticos standing nearby waved us forward. It took a minute to understand that the “road block” was actually a line of soda and beer cans placed in the road so that the cars passing that way would crush them. We were happy to oblige!
Mostly, in between the activities, we have just been enjoying the beautiful weather and our daily life here at the Cabinas. The air is sweet and clean. Everything is still green and lush. We’ve had a stretch of days with nothing but blue skies and fluffy clouds. The trumpet flowers are in bloom — just spectacular!
We still love our lives here. Recently, some of our friends have decided to move back to the U.S. and that makes us sad because we will miss them. But everyone must follow their own path and we wish them all well. But, for us, we are grateful for each day in this beautiful country, for the friends we have made, and for the rhythm of our days — day-in and day-out.
Paul’s Monthly Tip to Live for Less in Costa Rica: Speak Spanish – Save Money
Learning Spanish to save money tends to be more nebulous than other money-saving tips because it’s hard to put a dollar amount on how much you can actually save every week or month. But I do know that learning a little Spanish can help your life in so many ways, over and above just saving money. By learning a little Spanish, you can have a richer, fuller life in Costa Rica. You’ll be less isolated and not confined to the Expat or English-speaking world. There are a lot of wonderful people out there and 80% don’t speak English.
Even though there is little bargaining in Costa Rica as there is in other countries, like Mexico for example, there is a tendency of some to charge foreigners more. Speaking some Spanish puts you in the know and these events occur less frequently. There may be a “Tico price” and a “Gringo price.” What do you think can make the difference? Speaking Spanish. If they think you’re savvy, you’ll often get the lower price.
So, here are some ways that speaking Spanish may lead to saving money:
- Be able to question prices and ask why.
- Ask for a cash discount at the pharmacy, health food store, restaurant, hotel and many other places\Bargain at the feria (weekly farmers’ market)
- Ask questions at the car mechanic and authorize only the work you want done
- Ask for a lower price at hotels and tourist attractions
- Be more well-liked by the locals, therefore taken advantage of less (this one can save you thousands per year)
- Locals are more likely to protect you, and advise you when prices are out of line.
- Have a lot more fun!
- Be more confident
Don’t rob yourself…learn a little Spanish.
In that light, we promote a great online Spanish course. It’s the one I bought for my wife, Gloria. Visual Link Spanish did what it advertised. Within the first hour, Gloria was speaking in complete sentences over a variety of topics. It also appealed to her learning style – it teaches using multi-sensory methods: you see it in pictures, you listen to the words being pronounced, you speak the words, you write them, & you repeat them. It gave her a 750 word vocabulary and allowed her to speak in both present and simple future tenses. It was enough to get her started communicating in a Spanish-speaking country.
For those of you who don’t think you’d be any good at languages, or that you’re too old, then Visual Link Spanish is for you. But don’t take my word for it, try 11 free lessons by clicking here, and then decide.
Let’s see what happened on our mountain at 3950 feet elevation, four miles west of San Ramon. The dry season is in full swing. Just look at the trend over the last four months:
- October 2011: 35 inches (normal 13-15 inches)
- November 2011: 5 inches
- December 2011: 2 inches
- January 2012: 0 inches
We took the temperature at 6am, mid-day, and 6pm daily, as well as rainfall totals for the previous 24 hours, measured at 6am.
Rain Data from January 1st to January 31st (31 days)
- 0 inches of total rainfall
- 2 days measured trace amounts of rain
- 6am average: 58.3°f (lowest reading was 55°f on 2 days)
- Mid-day average: 72.6°f (high of 78°f & low of 63°f during a 3-day cold snap )
- 6pm average: 63.3°f (lowest reading was 59°f and highest was 65°f on 6 days)
That’s it for this report. We’ll continue the weather info next month.
Featured Article – 11.75% Colones CDs: Answering Your Questions
Many people have written to us asking questions about our local investments at Coopenae, so we thought we would follow up and try to answer some of the most common questions. Usually they have to do with why we chose to invest there and whether or not it’s safe. We met with Marco Ramírez Jiménez, the branch manager of our local Coopenae in San Ramon to get accurate information for this article.
Our bank, Coopenae, is actually not a bank but more like a credit union. Matter of fact, in their logo it says “Coopenae, La Cooperativa del Sector Educacion.” It started as a credit union for the educational sector and in many ways was a credit union for other, smaller, educational credit unions. In 1994, it opened up to anyone who wanted to join and started offering other services, much like a bank.
Question #1: “Why Coopenae?”
- First of all, it’s growing like crazy, with over 81,000 members
- It’s a non-profit.
- It’s been in business 45 years
- It has 19 branches in Costa Rica and growing
- It is the biggest Cooperativa in Central America and the 4th largest in Latin America
- What struck me most was the low-default rate on loans — less than one half of one percent, the lowest of any financial institution in Costa Rica. They are very careful about to whom they lend money, which accounts for their low default rate. The default rate on national banks is over 3%.
Question #2: “But how can they pay such high interest rates?”
- Presently, we’re getting 11.75% on a 12 month CD. Also, the account is in colones, not dollars. This is important to consider because of the exchange rate, but since we live in Costa Rica and intend to stay in Costa Rica, most of our expenditures are in colones.
- The average return on CDs at Coopenae is 10-11%, while the average loan they make is at 16%. This may seem high to you, but it’s about 6% lower than the national banks for the same kind of loans. This 5% difference is their “profit” which covers salaries, operating expenses, and expansion.
- Also, in the last year or so, Coopenae received two large loans ($15 million each) at 3-4% interest rates, one from the World Bank, and the other from a Dutch bank. This money was designated for small business loans, not micro-loans. Before the loans, Coopenae was thoroughly scrutinized by the aforementioned institutions.
- In addition, the regulating body of Costa Rica Superintendencia General de Entidades Financieras (SUGEF) monitors ALL 56 financial institutions in the country, has rated them the #1 Coopertiva in Costa Rica. They are also rated highly in the area of liquidity, which means, if you need your money, you can get your money.
Question #3: “What’s the Exchange Rate?”
- Lately the exchange rate hovers around 500 colones to $1
- Jan/Feb of 2008, the exchange rate was 495 colones to $1
- In 2010, the exchange rate was as high as 580 colones to $1
- To check current current exchange rate, visit the website for the Central Bank of Costa Rica
- We do not know what is going to happen with currency values in the future, although due to predictions of a stronger dollar and a weaker Euro, some project that the colon will go to 530 to the dollar – but who knows??
Question #4: “Is my money insured by the FDIC?”
- This is Costa Rica and deposits are not FDIC insured. However, SUGEF regulates all financial institutions here.
- In 2008, the “world financial crisis” started. In the U.S., people lost millions, their homes, IRAs, & pensions. We thought that investing in the U.S. was pretty risky, so why not invest in Costa Rica where we live and intend to live in the future.
Question #5: “Do I have to live in Costa Rica to open a Coopenae account?”
- Unfortunately, to open an account at Coopenae, one must be a legal resident, or at the very least, in the process to obtain legal residency. This is due to new laws that have recently been passed in Costa Rica. For those who are not legal residents and have been living in Costa Rica for more than a year, we are told that it may be possible to be grandfathered in under the old law.
So, is it risky? I don’t know. Is the stock market risky? The U.S. housing markets? How safe are our investments in the U.S., in the richest, most powerful country on earth? With permission of Coopenae, I have put their PowerPoint presentation to Investors below. It is essentially the same presentation I was given 2 years ago, although I didn’t become a client until June 2011.
To read our original article about Coopenae, click here: http://retireforlessincostarica.com/2011/07/investing-in-colones-certificates-of-deposit/
Disclaimer: The articles on this website are intended to provide general information only and have been prepared by RetireforLessinCostaRica.com without taking into account any particular person’s objectives, financial situation, needs or preferences. Our readers should, before acting on this information, consider the appropriateness of this information regarding their personal objectives, financial situation or needs. We recommend investors obtain financial, investment, or legal advice specific to their situation before making any financial investment or relocation decision.
We are often asked by readers how we made the decision to retire in Costa Rica. One of the first steps in our process was to read everything we could find on the topic. You can read about our book recommendations here. And when you are ready to buy, just click on the link for our Retire for Less in Costa Rica Amazon.com Store, located in the sidebar on every page of our website. You can also buy music, DVDs, and gourmet items, including Costa Rica’s signature Lizano Sauce and Cafe Britt’s Dark Chocolate Covered Gourmet Coffee Beans. Be assured, all orders are securely processed through Amazon.com.
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That’s all for this month, but we’ll be back in touch soon! If you enjoy our newsletter, please share it with your friends. We hope to see you online!
Gloria & Paul Yeatman
San Ramon de Alajuela, Costa Rica