"My wife Julie and I were ready for a big change,” Lee continues. “We wanted an adventure, to take ourselves as far outside our comfort zones as possible. So, when this chance came along to retire well ahead of the timeline I'd had in mind, I jumped at it." Lee and Julie considered many options for where to retire overseas. Finally, they settled on Ecuador. It seemed to offer everything they were hoping for. "Sometimes people who've retired to other countries boast that their lives in their new countries are hardly different from the lives they left behind back in the States," Lee says. "That's not the case with Ecuador. Living in Ecuador, you never forget that you're in a foreign country. For Julie and me, this was one of the biggest attractions." However, the most important reason that Lee and Julie chose Ecuador as the place to reinvent their lives at this stage was the cost of living. "As we made our plan for where to go," Lee remembers, "the reality of what we were doing began to settle in. I was only 49 years old, for crying out loud. What if we ran out of money? I began to worry about being back in the States at age 75 looking for work." Lee spent a lot of time running the numbers and, finally, he and Julie found the courage to make the leap. "We satisfied ourselves," Lee explains, "that, in Cuenca, Ecuador, the city we'd focused on, my pension would allow us to live very comfortably." Lee and Julie were pioneers. Two of the original Cuenca retirees, in 2001 they received Visa 1 and Visa 2 from the New York consulate when they applied for legal Ecuadorean residency. "We lived in Cuenca for nine months before meeting another English-speaking couple," Lee says. "We didn't mind. We were having so much fun taking advantage of all we discovered that Cuenca had to offer. This is a very cultural city, with free symphony events, museums, and annual art shows. "The best news, though, during those early months," Lee continues, "was the realization I had that the cost of living was even lower than I'd estimated. Cuenca enjoys great mountain weather year-round. This means no heat and no air conditioning. I had underestimated the effect of the climate on our overall budget." The cost of living in Cuenca has increased steadily in the dozen years since Lee and Julie first took up residence. Still, this remains one of the most affordable options in the Americas. You can rent an apartment for as little as US$300 per month. More typical is US$500 monthly. Figure a total budget of US$1,600 per month if you rent; US$1,200 per month if you own your own home. And you may, indeed, decide to invest in a place of your own. The cost of real estate in this city is one of the greatest bargains in all of Latin America, cheaper than in Montevideo, Uruguay; Medellin, Colombia; Fortaleza, Brazil; Panama City; or most any other Central or South American destination you might consider. You could buy a small city condo for less than US$50,000. Gas, too, is cheap, and Ecuador is a great place for exploring by car. Lee says that he invested in a car soon after making the move, because he and Julie so enjoyed motoring around the country. He advises figuring an additional US$150 per month if you own a car. One thing to remember about Ecuador is that this country uses the U.S. dollar. For an American retiree, this means it's easier to understand what things really cost; it's easier to keep track of what you're really spending, month to month; and, very important, you don't have any currency-exchange risk. You may still have local inflation to contend with, but you won't have to worry about that being compounded when the exchange rate goes against you. Given his extended personal experience living and investing in this country, we’re delighted that Lee has agreed to act as host for our upcoming Live and Invest in Ecuador Conference taking place in Guayaquil next month. The Early Bird Discount for this event remains in effect through Sept. 26. Details on the program we’ve put together with Lee’s help are here. Kathleen Peddicord
“At least that’s the case if you believe all the rhetoric you read online,” I continued with a smile, recognizing that we’re among the leading promulgators of said rhetoric.“Seriously,” I continued, “Panama remains one of the best places in the world to think about living, retiring, investing, or starting a business. However, today’s Panama is a very different place from the Panama of 10 years ago. It’s a different place today even from the Panama we moved to about five years ago.“Plus, of course, no place is perfect, including Panama. Even ‘paradise’ has its downsides,” I reminded this week’s conference-goers.Then, in that spirit, I reviewed 10 things that anyone thinking about spending time or money in Panama today needs to know to make a success of the effort, as follows:#1: Panama City is no longer a cheap retirement choice.The cost of living in Panama’s capital city has appreciated steadily over the past decade. As a result, today, Panama City no longer qualifies as a “cheap” place to call home. You can live modestly in this city on a budget of US$1,500 per month, but a more realistic monthly budget for an average couple of retirees would be US$2,000.The cost of living elsewhere in Panama, however, can be much more affordable. A couple could retire to Santa Fe, for example, in the highlands of Panama, on as little as US$1,000 per month.#2: Panama City rents aren’t cheap either.The lion’s share of any retiree’s budget is typically given over to rent. This is an important part of the reason why the cost of living in Panama City can be considerably greater than the cost of living many other places in this country. A retired couple will spend US$1,000 or more per month to rent a comfortable apartment in an appealing Panama City neighborhood. Meantime, you could rent a small house at the beach on the Azuero coast, for example, for US$600 per month or less or a house in the mountains around Santa Fe for US$500 per month or less.#3: Health care in Panama is international standard and costs a fraction the cost of comparable care in the United States.However, both the standard and the cost of care can vary dramatically, not only from one part of the country to another, but also depending where you seek care in Panama City. The Johns Hopkins-affiliated Hospital Punta Pacifica in downtown Panama City offers facilities and services like those available at any metropolitan-based U.S. hospital for perhaps half the cost. However, Clinica Einstein, located in Panama City’s El Cangrejo neighborhood, offers many of the same services in a small, friendly, clean clinic environment where doctors and nurses speak English, lab tests can be processed on site, and prices are half as much or less than those at Hospital Punta Pacifica...meaning they’re one-fourth as much as U.S. costs.#4: Panama offers many options for establishing legal residency.However, the great numbers of foreigners, especially foreign retirees, migrating to this country over the past several years has resulted in a backlog at the Department of Immigration that can mean months of delays getting your visa processed and approved.A new visa option, however, created by Executive Decree in 2012, offers a short-cut. This “Friends of Panama” visa, as it’s referred to, can be processed in weeks instead of months and can even result in a work permit.#5: Panama is not the banking haven it once was.When current President Ricardo Martinelli signed an exchange-of-information tax agreement with the United States in 2010, he ended the country’s position as a banking haven. Still, though, Panama, home to more than 80 banks, remains an international banking center.#6: Panama has used the U.S. dollar as its currency since 1904.This is an important advantage for American retirees today who don’t have to worry about exchange risk.#7: Panama is known as the “Hub of the Americas” for a reason.This is an ideal base from which to explore Central and South America. Panama City’s Tocumen International Airport is currently being expanded from 34 gates to more than 50 gates, and Panama’s airline Copa offers regular flights to every Latin American country and is adding more routes all the time.#8: Panama City is hot and humid year-round.However, elsewhere in the country the climate can be very different and much more appealing. On the coast outside the capital, the hot temperatures are tempered by ocean breezes, and in the mountains around Boquete, for example, the climate is cool and crisp year-round...even chilly.#9: Panama City is bursting with nightlife...Including five-star restaurants, casinos, night clubs, gentleman’s clubs, sports bars, pubs, discos...However, this is not a place to come for what you might call “high culture.” If your favorite thing to do on a Friday evening is to attend the opera or a live theater performance, Panama may not be the place for you.#10: Panama’s program of special benefits for pensionados is the Gold Standard.As a pensionado, you’ll enjoy discounts on most anything and everything you buy.Kathleen PeddicordP.S. My opening remarks for this week’s Live and Invest in Panama Conference were recorded. As I write, our preferred Panama health insurance agent Gonzalo de la Guardia is addressing the group, detailing their best options for both health care and health coverage in this country. Earlier, our recommended Panama attorney Rainelda Mata-Kelly reviewed the best options for establishing residency in this country...and resident Panama property expert Lief Simon armed conference attendees with everything they need to know about shopping for a place to live in this country.We recorded these presentations, too...and we’ll continue to record every presentation and discussion over the two-and-a-half days of this event. When the final speaker leaves the stage Friday afternoon, our team will set to work editing the complete collection of recordings and packaging them into our all-new Live and Invest in Panama Home Conference Kit.While the conference continues, however, this all-Panama resource is available pre-release for 50% off the launch price. Details are here.
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Kathleen Peddicord is the founder of the Live and Invest Overseas publishing group. With more than 25 years experience covering this beat, Kathleen reports daily on current opportunities for living, retiring, and investing overseas in her free e-letter.
Her book, How To Retire Overseas—Everything You Need To Know To Live Well Abroad For Less, was recently released by Penguin Books.
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