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As a friend who has been retired in Asia for many years puts it, "Everywhere in Asia is more affordable than the cheapest places in Latin America right now." That may be a stretch, but pockets of Thailand, Malaysia, the Philippines, China, Vietnam, and India, for example, can be absurdly cheap. You could live a modest but comfortable life in this part of the world on a budget of $700 or $800 a month, even less.

Living on this side of the planet, you'd also have access to some of the world's most beautiful beaches. Your life would be full of adventure, the exotic, and the unexpected. That is to say, the culture shock would be significant. For some, this reality is thrilling and invigorating...for others, it's intimidating, even terrifying.

In Asia, as well, you have an added challenge related to residency. Typically (an exception is Malaysia), you aren't going to be able to arrange to stay on indefinitely (legally) as a foreigner. You'll have to make regular border runs, which can grow tiresome and expensive (not to mention being illegal).

The easier alternative is not to approach Asia as a full-time choice but, instead, to create a  where-to-retire-overseas plan for yourself that allows you to enjoy the benefits of Asia (super cheap and super exotic) part-time. Don't worry about trying to qualify for permanent residency. Stay as long as you can as a tourist and then move on.

How about three months on the coast of Thailand, where your retirement budget would stretch far indeed, followed by a few months in the south of France, say, or Tuscany?

Where to Retire Overseas

Which brings us to the Continent. Not everyone is cut out for life in the developing world. If you're less interested in an exotic retirement than you are in a fully appointed one, your best options for where to retire in the world could lie in Europe. Most would-be retirees abroad dismiss this part of the world as too expensive, but that isn't necessarily the case, and, if it's a Continental lifestyle you dream about, I urge you not to write it off too quickly. Sure, a retiree on a modest budget probably can't afford Paris or Florence, but have you considered southwestern France, where life is quintessentially French but, as well, surprisingly affordable, or Pisa, about an hour from Michelangelo's hometown but dramatically less costly?

One of the big advantages of Europe, compared with other regional retire-overseas options, is the opportunity it affords for what might be referred to as "high culture." Every country in the world has local culture, but not everywhere has world-class museums, opera, and live theater, for example. If you're interested in a life that includes what are conventionally recognized as cultural offerings of the high-brow variety, you should be looking to France or Italy, Spain or Portugal.

This is not to say it's impossible to enjoy an Old World Continental lifestyle anywhere else. Some cities in South America offer a fair imitation, including, for example, Buenos Aires, and Medellin, Colombia. Both are cities of open-air cafes, classic-style museums and theaters, art galleries and antique shops.

And both, you'll note, are in South America, not Central America. The differences between these two regions, even between Panama and Colombia, next-door neighbors, can be striking. I'm speaking generally and you could find exceptions to every point, but, again, generally speaking, South America offers what I'd call more polished retirement options and is a good place to look if what you want is culture on the cheap.

Central America, by contrast, is, everywhere, rough around the edges. These are small, developing countries, struggling (let's be honest) to keep the lights on and the highways paved. They don't have money to invest in things like art museums. This can make for a way of life that is, for some, charming. Romantics (like me) in Central America see the potential for what could be rather than the reality of what sometimes is. Others find Central America frustrating, disappointing, even appalling.

On the other hand, this sun-blessed region can be but a quick plane hop away and a user-friendly place to establish foreign residency if you'd like to settle in full-time.

Pluses and minuses...give and take.

Kathleen PeddicordContinue Reading:

Image credit: Toksave

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Asia boasts a number of the most cost-friendly places anywhere to call home right now. Pockets of Thailand, Malaysia, the Philippines, China, Vietnam, and India, for example, can be absurdly cheap. Living on this side of the planet, you'd also have access to some of the world's most beautiful beaches.

Your life would be full of the exotic, the unexpected, and the adventuresome. That is to say, the culture shock would be significant. For some, this reality is thrilling and invigorating...for others, intimidating, even terrifying.

In Asia, as well, you have an added challenge related to residency. Typically (an exception is Malaysia), you aren't going to be able to arrange to stay on indefinitely (legally) as a foreigner. You'll have to make regular border runs, which can grow tiresome and expensive.

The easier alternative is not to approach Asia as a full-time choice but, instead, to create a retire-overseas plan for yourself that allows you to enjoy the benefits of Asia (super cheap and super exotic) part-time. Don't worry about trying to organize permanent residency. Stay as long as you can as a tourist and then move on. How about three months in Chiang Mai, where your retirement budget would stretch far indeed, followed by a few months in the south of France, say, or Tuscany?

Which brings us to Europe. Most would-be retirees abroad dismiss Europe as too expensive, but this isn't necessarily the case. Sure, a retiree on a modest budget probably can't afford Paris or Florence, but have you considered southwestern France, where life is quintessentially French but, as well, surprisingly affordable, or Pisa, about an hour from Michelangelo's hometown but dramatically less costly?

One of the big advantages of Europe, compared with other regional retire-overseas options, is the opportunity it affords for what a friend last week referred to as "high culture." Every country in the world has local culture, but not everywhere has world-class museums, opera, and live theater, for example. If you're interested in a life that includes what are conventionally recognized as cultural offerings of the high-brow variety, you should be looking to the Continent.

Which is not to say it's impossible to enjoy an Old World Continental lifestyle anywhere else. Some cities in South America offer a fair imitation--Buenos Aires, for example, and Medellin, Colombia, to name two. Both are cities of open-air cafes, classic-style museums and theaters, art galleries and antique shops.

And both, you'll note, are in South America, not Central America. The differences between these two regions, even between Panama and Colombia, next-door neighbors, can be striking. I'm speaking generally and could name exceptions to every point, but, again, generally speaking, South America offers what I'd call more polished options, a good place to look if what you want is culture on the cheap.

Central America, by contrast, is, everywhere, rough around the edges. These are small, developing countries with non-existent budgets for things like art museums.

Making for a way of life that is, for some, charming. Romantics (like me) in Central America focus on the potential for what could be rather than the reality of what sometimes is. Others find Central America frustrating, disappointing, even appalling.

On the other hand, this sun-blessed region can be but a quick plane hop away and a user-friendly place to establish foreign residency...

Pluses and minuses...give and take.

Kathleen PeddicordContinue Reading:

Read more...
 

"We're also going to walk you, in detail, your hand in ours, through the seven key issues you'll face no matter where in the world you decide to relocate, from health insurance and medical care to residency visas and figuring your retirement budget.

"However, before we get to all that, I'd like to take a step back with you and consider this big idea big picture, because, the truth is, retiring overseas isn't for everyone.

"Who should retire overseas? To make a success of this, you need three characteristics, primarily:

  • Open-mindedness...
  • A spirit of adventure...
  • A good sense of humor...

"I'd say that everyone in this room today has an open mind and a spirit of adventure. You're here because you're looking for something new, something better, something bigger, something different, something other. I'd say you're ideally suited to make a great success of this adventure precisely because you're considering it. Just don't forget your sense of humor. Your new life, wherever you choose to launch it, will be filled with delight and discovery.

"It will also be maddening. It will frustrate you, day by day, week by week. Some days, nothing you encounter and no one you come into contact with will make sense. But life in your new country of residence doesn't need to make sense to you. Neither are you going to change it. You're going to have to adjust to accommodate it as you find it. Along the way, it'll help if you're able to laugh..."

Following my opening remarks this morning, we launched into a series of panel discussions. Our program for this Retire Overseas Conference has been conceived to provide full-spectrum information and insights--pluses and minuses, good and bad--and to showcase as many different points of view as possible.

First up on stage were Lief Simon and Paul Terhorst, our resident bean counters, the two guys I know who are most experienced and most expert at counting costs and calculating budgets. Lief and Paul walked the group through the thinking that goes into figuring out where you can afford to retire.

"The question," Lief explained, "isn't how much does it cost to retire overseas?

"The question," he continued, "is how much money do you have to retire on?"

Lief and Paul then proceeded to show attendees how to determine the answer to that question.

"Once you know the size of your retirement nest egg," Paul explained, "then you can figure out where that nest egg will buy you the retirement you want.

"In fact, though," Paul continued, "I'd say that's not the way to approach this. That's backwards. Start by thinking through the life you want. Imagine your ideal lifestyle. Then look at the numbers in that context. Where will the budget you've got buy you the lifestyle you're looking for?"

Lief and Paul left the stage...and were replaced by Lee Harrison, Mike Cobb, and Paul Reynolds, our three top Latin America experts. Lee, Mike, and Paul spent the next hour showing attendees the pluses (accessibility, affordability, great weather, and lack of regulation) and the minuses (infrastructure, the manana mentality, and lack of regulation) of the region where they each, for very different reasons, have, for decades, been focusing their time and attention.

Next up, our Euro-experts: Lucy Culpepper, Nikki di Girolamo, and Lief Simon. Advantages of Europe, according to Lucy, Nikki, and Lief? Infrastructure, culture, overall quality of life, and health care. Disadvantages? Language and cost. The good news, though, as Lucy, Nikki, and Lief all can attest from personal experience, is that the cost of living in Europe can be much, much less than you might imagine. Lucy and Nikki identified particular Euro-regions and particular towns, including Sitges in Spain, Languedoc in France, and Abruzzo in Italy, where the cost of living in retirement can qualify as very low.

Finally, our Asia pros: Paul and Vicki Terhorst and Wendy and David Justice. Pluses of Asia, according to our Asia experts? In fact, in this case, there's one great big serious plus: the cost of living. As Paul Terhorst put it, "Everywhere in Asia is cheaper than the cheapest options in Latin America."

That put things into perspective.

Downsides to Asia? It's exotic, it's far away, and you'll struggle to be understood, sometimes even to read a restaurant menu. For the right person, though, the unbelievably low cost of enjoying the exotic delights of this part of the world can more than offset the associated challenges.

As I write, we're enjoying lunch. After lunch, we'll launch into a series of half-hour country-specific workshops, to begin to introduce in detail, with the help of expats with firsthand experience in each case, the world's current 20 top retirement havens.

More from the scene tomorrow...

Kathleen Peddicord

P.S. We're recording every presentation, every panel discussion, and every country workshop. The complete library of recordings and associated materials will be available for sale as our all-new Retire Overseas Home Conference Kit as soon as the recordings have been edited. Meantime, while the conference is taking place live in Scottsdale, you'll be able to reserve your copy of this one-of-a-kind resource at a special pre-publication discount (of more than 50%). Full details available tomorrow.Continuing Reading:

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None of these places felt right, and, finally, Lucy and her crew realized that that fact was less to do with Mexico, Costa Rica, and Panama and more to do with a fundamental personal preference:

Her family prefers Old World living. So they recalibrated and launched a new search on the other side of the Atlantic. This time, they landed in the south of France, which, Lucy reports, is perhaps the best value lifestyle option on the Continent today.

As Lucy explains, this region is "colorful, eclectic, always changing, never following a formula, and very open to retirees."

This is wine country, with a long history and a lot of heart.

And, as Lucy and her family discovered, this region can be far more affordable than you might imagine. Certainly this isn't the cheapest place in the world to retire. However, Lucy calculates that a retired couple could live comfortably here on just about 1,200 euro a month, including 500 euro a month to rent a two-bedroom apartment.

Lucy will be joining us in Scottsdale late April for our next Retire Overseas Conference, when she'll present top current retirement and lifestyle options in Europe, including in this region of France.

In preparation for that event, Lucy has been researching the local property market in this part of the world. She wrote this week to share some of her discoveries...including:

A 91-meter-square stone house just outside the Cessanon-Sur-Orb village center, with a garden, a terrace, two garages, and a pretty view across the Orb Valley, on offer for 112,000 euro...

A typical winemaker's home...a 200-square-meter house with five bedrooms and many original features, including stone floors and large windows, in need of renovation and updating, with an asking price of 180,000 euro...

A five-bedroom house with a large garage plus an independent apartment with a private terrace and street-level access, both with 125 square meters of living space...plus the property has an enclosed 600-square-meter garden with space to create a swimming pool...asking price is 180,000 euro...

A charming, fully renovated, 90-square-meter, two-bedroom stone village house (with a new roof and double-glazed windows) with a vaulted cellar and a pretty living room with a beautiful fireplace, ready to move into, on offer for 117,000 euro...

Another completely renovated two-bedroom, two-bathroom, 80-square-meter house with a roof terrace and open views across the Orb Valley, again, no work required, ready to move into, for 168,000 euro...

Or, if your budget is a bit bigger, a spacious four-bedroom villa, with 280 square meters of living space, a 100-square-meter terrace with summer kitchen, a swimming pool, and a 7,280-square-meter landscaped garden with a view to the mountains, turn-key and beautiful, for 990,000 euro.

Lucy recommends two local property agencies as good places to launch your search in this part of the world:

She'll have much more to share, about her experiences as an expat in France and Spain, about the current best lifestyle and retirement options to be found on the Continent, and about buying, owning, and renovating your dream home in the Old World, in Scottsdale late April.

Kathleen PeddicordContinue Reading:

Read more...
 

If you're considering the idea of relocating to another country, where should you be looking? As I remind you regularly, it depends what you're looking for...

In these dispatches, I give a lot of virtual ink to Latin America. That's because it's nearby to North America (where most of our readers currently reside) and because it can be cheap and sunny (two things most would-be expats and retirees abroad actively seek).

But there's a world beyond these Americas that can also offer good weather and a low cost of living...plus, in some cases, some things you won't find in this part of the world.

Asia boasts a number of the most cost-friendly places anywhere to call home right now. Pockets of Thailand, China, India, and Vietnam, for example, can be absurdly cheap. Living on this side of the planet, you'd also have access to some of the world's most beautiful beaches.

Your life would be full of the exotic, the unexpected, and the adventuresome. That is to say, the culture shock would be significant. For some, this reality is thrilling and invigorating...for others, intimidating, even terrifying.

In Asia, as well, you have an added challenge related to residency. Typically (exceptions can be Malaysia and Vietnam), you aren't going to be able to arrange to stay on indefinitely (legally) as a foreigner. You'll have to make regular border runs, which can grow tiresome and expensive.

The easier alternative is to approach Asia not as a full-time choice but, instead, a part-time one. Create a new-life-overseas plan for yourself that allows you to enjoy the benefits of Asia (super cheap and super exotic) part-time. Don't worry about trying to organize permanent residency. Stay as long as you can as a tourist and then move on.

How about three months in Chiang Mai, Thailand, where your retirement budget would stretch far indeed, followed by a few months in the south of France?

Which bring us to Europe. Most would-be retirees abroad dismiss Europe as too expensive, but this isn't necessarily so. Sure, a retiree on a modest budget probably can't afford Paris, but have you considered southwestern France, where life is quintessentially French but, as well, surprisingly affordable?

One of the big advantages of Europe, compared with other regional retire-overseas options, is the opportunity it affords for what a friend last week referred to as "high culture." Every country in the world has local culture, but not everywhere has world-class museums, opera, and live theater, for example. If you're interested in a life that includes what are conventionally recognized as cultural offerings of the high-brow variety, look to the Continent.

Which is not to say it's impossible to enjoy an Old World Continental lifestyle anywhere else. Some cities in South America offer a fair imitation--Buenos Aires, for example, and Medellin, Colombia, to name two. Both are cities of open-air cafes, classic-style museums and theaters, art galleries and antique shops.

And both, you'll note, are in South America, not Central America. The differences between these two regions, even between Panama and Colombia, just next-door, can be striking. I'm speaking generally and could name exceptions to every point, but, again, generally speaking, South America offers what I'd call more polished options. Not everywhere. It's possible, of course, to retreat to a lifestyle that'd qualify as modest, even basic, on this continent.

At the same time, though, South America is the place to focus if you want culture on the cheap.

Central America, by contrast, is, everywhere, very rough around the edges. These are small, developing countries with non-existent budgets for things like art museums.

Making for a way of life that is, for some, charming. Romantics (like me) in Central America focus on the potential for what could be rather than the reality of what sometimes is. Others find Central America frustrating, disappointing, even appalling.

On the other hand, this sun-blessed region can be but a quick plane hop away...

Pluses and minuses...give and take.

Kathleen Peddicord

P.S. What else this week?

  • Set yourself up properly, and you'll be liable for no corporate tax. Not in Panama and not anywhere else either (including, you may be wondering if you're an American, in the United States).

That's a big reason why Panama is the #1 place in the world right now to start an online or e-commerce business. It's also the best place to base yourself if you want to make a living from consulting, travel writing, copywriting, or any other laptop-based profession you can think of.

The key is that your customers are outside Panama. In other words, as long as the revenues of your business aren't sourced in this country, you don't pay tax on them in this country. And, again, as long as you structure your corporation properly, you won't be liable for taxes from the revenues that flow through it anywhere else, either.

That's hard to beat.

In addition, I'm more convinced that Panama is the best choice for launching and building an Internet-based business the longer we're operating here for other reasons, as well...

  • "My friend Ivan and I crossed the border from Ukraine into Suceava, Romania," writes Intrepid Correspondent Paul Terhorst, continuing his East European adventures.

"We were told to expect hassles at customs. Now that Romania has entered the European Union, the country has become more expensive. Smugglers from Ukraine hide cigarettes and alcohol, hoping to sell for more across the border.

"In the customs area, I was reading a book while waiting--a Harlan Coben mystery, if it matters, and I'm pretty sure it didn't. When the customs guy got to me, he grabbed my book. He saw it was in English.

"Apparently that was all he needed to know; cigarette smugglers in that part of Romania must read in other languages. Profiling...

  • "My friend Ivan and I were traveling in Transylvania, Romania," writes Intrepid Correspondent Paul Terhorst, picking up where he left off yesterday.

"We met many people who spoke English, especially in restaurants and hotels.

"I'd expected more French; Romanians have always been francophiles. But, no, these days English has taken over. All those English speakers meant that Romania was an easier place to travel than other countries we visited (Bulgaria, Moldova, Ukraine) on this trip...

Also This Week...from Resident Global Real Estate Investing Expert Lief Simon:

I've written in the past about my general concerns related to the Brazil real estate investment market. Not because I don't think there's money to be made here, but because it's a difficult market to navigate. You've got language issues, currency issues, and issues to do with moving money in and out. Bottom line, this market is more complicated than the typical small investor is prepared for. The costs of investing here, in terms of both time and money, can easily eat up any profits you might otherwise realize.

That said, I've kept Brazil on my radar, thinking that, eventually, I'd find an opportunity in this market that makes sense.

And I have.

A group I know in Fortaleza is offering an agricultural investment opportunity that I believe is interesting even for small investors. The minimum capital requirement is low, and the risks aren't extreme. Plus (and this is important), they've eliminated at least one of my big concerns--getting your money out of the country when you decide you want to.

The opportunity is coconut trees. The premise is straightforward. You buy 2 hectares planted with coconut trees, and the management company does the rest. The reality isn't quite that simple, but that's the bottom-line idea.

A managed plantation is really the only way for an individual to invest directly in agriculture...short of becoming a farmer yourself. The management company handles all the work, from planting and maintaining the trees to harvesting the crop. In this case, the crop is coconuts.

Coconuts produce several end products that give them value--coconut meat, coconut milk, coconut oil, and the husk of the nut. The big value is from the oil. It's used for biofuel, and, as you probably know, Brazil is a leader in developing biofuels. Right now more than 50% of the cars in Brazil run on bioethanol, and 90% of new cars in Brazil are designed to burn biofuel.

The price of coconut oil increased 93% from August 2010 to February 2011. It's expected to continue to rise as demand increases for biofuel, but, even if it doesn't, owning a couple of hectares of coconut trees can be a profitable concept. Of course, owning a couple of random hectares of any kind of tree doesn't make much investment sense. For this kind of investment to work, you need trees that are managed professionally by an outfit that has access to a ready market for the sale of the end product.

You could always invest in a plantation of your own, but this is an ambitious undertaking, and, unless you're willing to invest a lot of time in understanding the industry and in managing the farm, you'll likely end up with little more than a bunch of trees. I see this all over Panama--teak "plantations" planted by people wanting to take advantage of government tax incentives for reforestation. Most of these plantations won't yield any return to speak of, because the owners haven't managed the tree growth and have no idea how or where to sell the timber when it's time for harvest.

This is why, for my money, buying into a managed plantation where you own the land is the only sensible way to invest in trees. You have direct ownership (rather than shares of a company, which I don't recommend), while benefiting from the management company's economies of scale and expertise.

Over the years, I've looked at several tree investment opportunities. In the case of the coconut plantation on the table now, the numbers are compelling.
Here's how this works.

You invest in 2 hectares, on which you can plant 500 trees. Each tree produces about 150 coconuts a year and each coconut sells for about 47 cents in today's market. This gives you around US$35,000 in gross revenue annually. The plantation manager takes 30%, leaving you with about US$25,000 a year in net revenues.

The cost of the investment is US$35,000.

What's the catch? The trees don't begin producing fruit for three years and aren't fully mature (that is, producing the 150 coconuts a year) until year five. Still, the projected returns are high.

The long-term projection for your return on investment is 33% annualized. Coconut trees produce for 60 years, so you wouldn't have a replanting issue in your lifetime. Should you want to resell your 2-hectare plantation at some point in the future, I would think that a buyer could be found if the management company isn't interested (and they likely could be, depending on the price you seek). There are always investors looking for a productive yield.

Back to my concerns about Brazil...

Language: In this case the marketing company speaks English and they have an English version of the contract. Management at the plantation company also speaks English, so you'll be able to communicate with them.

Currency: Investing the full amount at once (rather than signing on for monthly payments over three years, as many promoters are suggesting for the pre-construction condos being marketed in this part of the world) helps eliminate currency risk. You only have to worry about future ups and downs of the currency exchange if you've got an extended payment liability. In this case, you know up front what your actual dollar investment will be.

Of course, your returns will be in Brazilian reais, meaning you still have this currency exposure. But one can't predict and therefore can't worry about long-term currency rates, especially over a 60-year cash flow.

Getting your money out: The contract states that investors can elect to have their profits wired to any bank in the world. You just pay the wire fee. The burden of getting your money out of Brazil, in full, is borne by the plantation company, which has accounts outside Brazil for operations. Therefore, this risk is greatly reduced.

One more thing to consider with any investment is local taxes. The projected returns I'm quoting here for this opportunity are pre-tax both in Brazil and obviously in your home country. The income tax rate for non-residents in Brazil is 15% on "non-earned" income. It is also 15% on capital gains. Any taxes paid to Brazil can offset U.S. taxes for U.S. citizens (and should for other countries, as well, but check with your tax accountant). So the net tax bite shouldn't interfere too much with your net ROI.

With the minimum investment being only US$35,000 (you could buy more than one 2-hectare investment, of course), this is a low cost way to diversify your real estate holdings. You get titled land with productive trees, turn-key management, some currency diversification, and a potential yield that is very appealing.
For more details on this opportunity, get in touch here.

P.S. I wanted to hop on a plane to go to see this plantation and to meet with the management company in person. Unfortunately, getting to Fortaleza from Panama isn't as easy as getting there from the United States (and it's not easy getting to Fortaleza from the United States). I still intend to try to make it down there at some point, but the travel itineraries mean a big investment of time.

You might find it easier to connect with Anthony (as I'm looking forward to doing), regarding this investment and other current opportunities in Brazil, during our upcoming Offshore Summit, taking place in Panama City, Sept. 14-16. You can read more here.

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Kathleen Peddicord

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.

Read more here.

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