Retiring Abroad -- Where Do I Really Want to Retire?

Retirement abroad requires careful planning. Here are some important steps to take before you go:

Check Visa and Residency Requirements

Immigration and residency laws differ greatly from country to country. Determine if you need a visa to enter and reside in the country where you want to retire. If dual citizenship is an option for you, review information on dual nationality before taking this step.

Know the Local Laws

Seek professional legal advice before settling abroad. Determine whether your trust, will and powers of attorney may be legally enforceable in your country of destination. Especially in local real estate matters, it is important to understand any contracts you are asked to sign. Review the local traffic laws and licensing requirements if you intend to drive. Some countries have a changeable political environment with different legal systems than you are accustomed to. Be sure to find out what civil liberties and political rights you will have as a foreign resident.

Prepare Your Finances

Determine your retirement budget, and allow for exchange rate fluctuations and inflation. You may want to meet with a financial adviser before you go and consider such things as opening a local bank account.

Research Medical Care and Costs

Health care tops the list of concerns for many who are thinking about moving abroad. Many countries have national health systems, but it is important to investigate eligibility, availability and quality beforehand. Note that environmental conditions at your overseas destination may contribute to specific health concerns, particularly if you are sensitive to altitude, air pollution, humidity, or other conditions. Consult with your physician prior to your move overseas to identify your healthcare needs at your retirement destination. We highly recommend that you get health insurance to cover private medical and dental treatment and for medical evacuation to the United States just in case.

Understand your Social Security Benefits

If you are thinking about retiring abroad, find out if you can receive your Social Security or other benefits outside of your country.

Pay Your Taxes

Leaving your does not exempt citizens from their tax obligations. While some retirees may not owe any tax while they are living abroad, you must still file a return annually. This is the case even if you move all of your assets to a foreign country; you may still be taxed on income regardless of where it is earned.

Retirees abroad must also fulfill any tax obligations of their foreign country of residence. The United States has tax treaties with a number of countries that address double taxation, but these treaties generally don't exempt residents from the obligation to file a return. For more information, please review the tax information for residents and citizens living abroad.

Research Accessibility and Accommodations

If you have mobility difficulties or use a wheelchair, determine access to areas such as swimming pools, public facilities, restaurants, bars, toilets, etc. Determine if shopping and entertainment are accessible. For more information, check out our section on Traveling with Disabilities.

Beware of Scams

Retirement funds are an attractive target for scammers who make false promises of romance, friendship, or financial gain. Scammers operate primarily via the Internet, email, and phone. For more information, please review our information on International Financial Scams. Information on scams common in your destination country can also be found in each country's Country Specific Information.

Prepare for Emergencies

Leave emergency contact information and a copy of your passport biographic data page with family and trusted friends. Carry emergency contact information for your family with you when you travel. (Be sure to also pencil it in the emergency contact information section of your passport.) Know the contact information for the nearest embassy or consulate and provide that information to your family and friends. If there is an emergency where you are staying, such as civil unrest, disrupted transportation, or a natural disaster, prevent undue worry or concern by contacting your family and friends as soon as possible.

Stay Connected

We recommend you to register with the embassy/consulate to receive important information, including the location of the nearest embassy and consulate and safety conditions in your destination country. This will help you make informed decisions about your travel plans and safety and security when living overseas.

Deciding where to retire abroad is a difficult decision. Retiring overseas can dramatically reduce your cost of living. You can enjoy a better retirement lifestyle with significantly more disposable income abroad.

Moving overseas gives you an opportunity to reinvent your life in retirement. In many places you will also be able to significantly reduce your cost of living.

Retirement is a goal that we have been working toward for decades. But retirement is also a journey. It begins when we leave work, and can easily last for several years. As with any journey, it sometimes makes sense to stop and review where we've been and where we're going.

Here are five questions to ask yourself when you first retire, and then again on a regular basis throughout the rest of your life. You may only need to review your situation once every few years.

1. Are you on track?

You probably had a vision – or at least some dreams – of what retirement would look like. Hopefully you had more concrete plans, and maybe even a budget by the time you actually left work. Now you should ask yourself: How am I doing? Think about your lifestyle. If you haven't launched your retirement life, what's stopping you? It could be an emotional issue or a financial problem. If you haven't made a plan, or have deferred a lot of decisions, now is the time to take control and get on with your life.

2. What has changed?

Retirement involves a transition from working and saving to relaxing and spending. But the way you start retirement may not be the same lifestyle you settle into a few years down the line. Early retirement years often involve living out long-held dreams to travel or relocate. You may want to re-evaluate your budget, as well as your expectations, after you've tried out your new life for a while and have a better sense of what the future holds.

3. What do you want to change?

Compare the vision you had for retirement with the reality of your current life. Is there anything about your new lifestyle that hasn't measured up to your expectations?

4. Are any surprises in store?

When you set your retirement budget, you presumably projected the everyday expenses that will likely not vary much from month to month or even year to year. Then it's time to re-evaluate your position

5. You should have a plan and be willing to change.

It's prudent to plan ahead. But it's also important to remain flexible, especially from a financial point of view. You make a plan based on everything you know, plus some reasonable projections.

Sometimes retirement doesn't play out exactly the way you envisioned it when you were younger. There may be periods of uncertainty. But if you're flexible, and periodically review your situation, then you will most likely find clear skies ahead.