Retire To Malaysia, Thailand, India

You'll find them in Asia.

"I still feel like Alice in Wonderland at times," Paul says, "with the temples and dances, food and drink, language and laughter, parks and wildlife. I predict you'll feel like Alice, too, at least part of the time.

"But don't let that keep you away. Today you can travel almost everywhere in Asia. Vicki and I recommend you do so. As much as possible, we also recommend you travel over land. You want to travel at street level, to take tuk-tuks, to order from street vendors, and to chat with innkeepers. You want to get to know people here, to share in their daily triumphs and to mourn their losses..."

Of the many good reasons to visit Asia now, one of the best, I say again, is that it's cheap.

Super, you-won't-believe-how-far-your-retirement-nest-egg-will-stretch cheap.

Among the most affordable choices in Asia (and the world) right now are Thailand and Malaysia. This past week, Asia Correspondent Wendy Justice helped you glimpse what your life might be like as an expat in these countries, retired to Chiang Mai, for example, or to Kuala Lumpur.

Wendy's reports included itemized budgets for your cost of living. Bottom line? Her figures show that you could retire to Chiang Mai on a budget of US$1,135 per month, including rent, weekly help around the house, and regular nights out...

And you could retire in comfort in Malaysia's vibrant capital on a budget of US$1,223 per month, again including rent, household help, and weekly entertainment.

Rent cheaper, forgo help around the house, and eat at home most nights, and you could pare those budgets back by US$300, US$400 per month...even more.

We'll continue our coverage of the world's cheapest and most exotic retirement havens this week, with reports of expat life in Vietnam, China, India, and Oman.

"Southeast Asia, especially China," Paul Terhorst explains, "still has regions so remote that you won't see expats or, more to the point, anyone who speaks English. Even in those cases, you can try to imagine your life there, as I've done. How would you get by? Answer: Pretty well...

"Asia opens a whole new world, exotic and cool, glittery and mystic. Languages not only have different ancestors, they have different alphabets, sometimes no alphabet at all...

"It's for all these reasons that Vicki and I have decided, starting this year, to spend more time in Malaysia, India, and southern China. We love all three places—the weather, people, culture, things to do, food, and so on..."

Once you've based yourself in Asia, travel within the region can be absurdly cheap. Discount carrier Air Asia makes its base in Kuala Lumpur and expands its route structure regularly. As Paul explains, "Tony Fernades, the founder of Air Asia, laughs at the state-owned airlines that provide the so-called competition. Tony runs circles around them.

"Just to give you an idea, earlier this year, Vicki and I flew from Kuala Lumpur to Singapore on Air Asia for US$8 each, including all taxes and fees. We took airport buses to/from the respective airports, adding another US$5 to our door-to-door trip.

"Total cost was US$13."

One more time: Try Asia.

Try Asia now.

More tomorrow and throughout the week.

Kathleen Peddicord

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ALSO THIS WEEK From Global Real Estate Investing Guru Lief Simon:

Yields. That remains the name of the game for most experienced real estate investors right now.

Some I know are still chasing capital appreciation...looking for undervalued markets they think will spike in the next 12 to 18 months. Chasing growth in the real estate world right now, especially big growth short-term, is risky and unrealistic. Taking a very long-term view, you could put some of your real estate portfolio into investments for big capital appreciation, but yield-generating property is a better play right now.

But what is a good yield? My general range of acceptance is a net yield of 5% to 8%. Note that I'm talking about net yields. Many real estate agents and property marketers talk about gross yields. Gross yields, however, don't tell you the whole story and therefore don't allow you to compare yields across markets.

Compare a gross yield in Country A of 10% to a gross yield in Country Z of 15%, and you might think that Country Z is the place to put your money. But what if Country Z charges high property taxes and higher management expenses? Bottom line, you could end up with a net yield of 8% in both cases. With the net yields being equal, you have to look more closely to decide which place makes more sense for your investment.

A friend invested in a project in the Philippines early this year that was projecting 19% net yields based on the price at which he bought in (they increased prices throughout development, and the yield projections eventually dropped to 15% for the final sales).

I was skeptical as to how any legitimate outfit could project that level of return. After reviewing the due diligence my friend had put together, which was very thorough, however, I was convinced that the projections probably weren't far off, thanks to a couple of extraordinary circumstances.

At the other end of the scale, you can pretty easily find reliable rental investments in France paying out net yields of 4% to 5%. I'm thinking of condo-hotel properties that are part of this country's French Leaseback program.

With a Leaseback, the management company signs a long-term lease with each unit owner for a set net annual amount (payments are made quarterly). You've locked in your cash flow for the term of the lease (the initial lease is typically for nine years).

Which of these two things is a better investment? Most investors would jump on the Philippine investment over the French one, thinking that a double-digit yield is surely more appealing than one of 4% to 5%. Who doesn't want to earn four times as much on his capital if given the option?

But what about the other risk factors?

In both these cases, you have currency risk; however, your currency risk against the Philippine peso is probably greater than it is against the euro.

I'd say the Philippines comes with more what I term "market risk." Market risk in France would be very low. This is the world's most proven tourist market, probably the safest place on earth to invest in a tourist rental.

The resale risk for the Philippines investment is unknown, as this was a new project in an emerging resort area. In France, again, I'd say the resale risk is low. The Leaseback program has been around for nearly decades, and an active resale market has developed among investors looking to buy operating Leasebacks already throwing off cash flow.

Finally, the Leaseback properties come with an inflation clause in the rental agreement, meaning your yield, modest as it is, is adjusted upward for inflation throughout the term of your lease.

Which of these two yield plays is the better investment?

That depends on your personal circumstances, on your level of risk tolerance, and on the make-up of your portfolio overall.

Are you shopping for safe returns (the French Leaseback is about as safe as international real estate investing can get)? Or are you looking to speculate a little with the hopes of bigger gains?

Best case, of course, would be to balance your portfolio with both plays...

*** COMING SOON! ***

First Annual Retire Overseas Conference
Stateside...Late May 2011

The world's top 18 overseas retirement havens. Detailed, compared, and contrasted by the world's savviest retire-overseas experts.

This is Retire Overseas 101, live and fully interactive.

For each of the 18 top havens on our list, we'll look in great detail at everything from cost of living to health care, from political stability to taxes, from the average annual rainfall to the best options for obtaining foreign residency status, from how to find the best deal on a rental to how to purchase a new home of your own, from opportunities for starting a business to how to budget your new life...

No theory. No marketing spin. No, boy, the view of the ocean from your bedroom window will be lovely...

Well, maybe a little of that.

We don't want to forget the dream entirely. We're all chasing it. The dream of a new and better life somewhere cheap, sunny, and safe.

I do my best to keep the dream front and center for you in these dispatches each day. Day-dreaming about the possibilities of a richer, fuller life in a sun-drenched overseas paradise is fun. No argument from me on that.

I've harbored (and written about) this dream for more than 25 years, and I still enjoy being reminded of all the new opportunities for discovery and reinvention that await just around the next bend in the road...

I also understand, at this point, that day-dreaming doesn't make it so.
To realize your dreams of a new life overseas, whatever form they take, you need to set aside the romantic, and you need to focus, at least for a while, on the real.

That's our agenda with our First Annual Retire Overseas Conference. And that's why we're holding it Stateside.

We want to make it as easy as possible for you to take this first step. Once you do, once you sign on to join us in May, we'll take over.

Our program is going to be geographically comprehensive (covering the top options right now in the Americas, Europe, and Asia, with experts from each region). It's going to provide all the nuts-and-bolts information you need, with special, in-depth sessions on health care, residency, financial planning for retirement, and taxes.

And, again, it's going to be fully interactive, with workshops, during which our experts will walk you through how to choose the overseas haven that's right for you, how to budget for your dream retirement, how to choose the international health insurance plan that's best for you, and how to establish yourself in your new life.

I've been putting on live, invest, and retire overseas conferences for more than two-dozen years. The program we've conceived for this one is nothing like that of any other event I've been involved with in the past.
This takes overseas retirement planning to the next level.

I speak for the entire, far-flung Live and Invest Overseas team when I say, we can't wait for May!

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Go here now to learn The 10 Best-Value Destinations for Living and Investing in the World Today

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