9 Steps You Can Take Today To Realize The Retirement You’ve Been Dreaming About
The first and perhaps most important step you must take to make sure that you arrive where you want to be in your new life overseas is to understand what, really, you want your new life overseas to be.
What’s important to you? What are your priorities? Your agendas? Your preferences?
What are you not willing to give up from your current lifestyle… and what would make you miserable in your new one?
Your challenge, as you begin the process of deciding where to launch your live- or retire-overseas adventures, is to consider the world in the context of your personal circumstances and objectives. Then you can connect the dots between the world’s most interesting and appealing places to spend time… and your own situation.
Step one, though, is to be clear in your own mind what your situation is.
And, critically, if you’re intending to make your move with a significant other, you need to come to these understandings jointly. If you and your significant other have different ideas about what constitutes a dream life overseas, you want to identify the differences and address them sooner rather than later.
Here are the fundamental issues you must consider at this getting-started stage of your go-overseas process:
Critical Issue #1: Are you planning to move alone? With a significant other? With other family members? With children?
As I said, if you’re moving with a significant other or with other family members, you must work to consider every issue and to address every question together, and you must allow all sides a voice. Making a success of a new life overseas requires energy, commitment, and a positive attitude. You don’t want to force someone into it.
If you’re planning to move with children, then at least one of your priorities is clear: The children. You’ll want to take their comfort, care, security, and education into account above all else.
Critical Issue #2: How concerned are you with what your family and friends think?
Your family and friends may surprise you (and me). They may be nothing but supportive and enthusiastic about your plan to launch a new life in a new country.
And probably some of them will be.
Others, though, will think you’ve lost your mind. They’ll forward you media links and State Department warnings to show you how dangerous and ridiculous an idea it is to think about leaving the safety of home and heading off to some exotic foreign land, where you’ll be at the mercy, they’ll assure you, of non-English-speaking thieves and scallywags. Plus you’ll be lonely… homesick…
You need to make up your mind right now that you won’t be dissuaded by any of it. Stay the course. You’re on the road to a future better and brighter than your naysaying friends could ever imagine.
They don’t get it… but that’s OK. They don’t have to get it.
Critical Issue #3: Do you want to live among the locals or in a more private, perhaps gated setting with fellow expats for your neighbors?
If you choose to relocate to an established expatriate community, you’ll have no trouble slipping into the local social scene and finding English speakers who share your interests.
On the other hand, going that route, you might end up with little real experience of the new culture you’re adopting.
This important early decision may not have occurred to you. But I encourage you to consider the question directly, for the answer sets you on one track or another, and they lead to very different places.
It can be easier, frankly, to seek out a place like Ajijic, Mexico, or Boquete, Panama, where your neighbors would be fellow North Americans, where you’d hear more English on the street than Spanish, and where you’d have like-minded compatriots to commiserate with over the trials and tribulations of daily life in a foreign country. Ajijic, for example, could as easily sit north of the Rio Grande as south. It can seem like a transplanted U.S. suburb.
This can make it a terrific first step for some, a chance to dip your toe in the live overseas waters rather than diving in headfirst. In Ajijic, you’re living overseas and enjoying many of the benefits (great weather, affordable cost of living), but the surroundings and the neighbors are familiar in many ways. You can shop at Walmart, meet up with fellow Americanos for bridge on Thursday evenings, and never have to travel far to find English-language conversation.
On the other hand, life in Mexico would be a very different experience residing in a little fishing village or a small colonial city in the mountains where you’re the only foreigner in town. Settling among the locals means you must learn to live like a local.
Is the thought of that appealing, exciting, and invigorating? Or terrifying? Be honest with yourself as you consider your response.
There is no right or wrong reply, and there are pluses and minuses either way. During our 20-plus years living outside the States, Lief and I have gone local, first in Waterford, Ireland, then in Paris, now in Panama. In our neighborhood here in Panama City, English is spoken almost nowhere, and I still struggle sometimes to manage effective communication with shopkeepers, repairmen, and our neighbors.
Living in a gated community, I wouldn’t face that challenge. And, living in a gated community, the streets would be kept cleaner, and the landscaping would be manicured. We’d have access to a swimming pool, a clubhouse, maybe riding stables, and a tennis court. Security at the gate would keep out anyone without permission to pass, roving guards would keep watchful eyes over our property, and our neighbors would likely all speak English just like we do.
And that could be great, too.
Great, too, but very different.
Critical Issue #4: Do you want to learn a new language?
If the answer is no, your situation is simplified considerably. You’ll need to learn to speak at least a little of a new language in most places you might be thinking about living overseas… but not all. In a handful of the best places in our world to call home, English is the official language, spoken everywhere.
If you don’t want to learn a new language, these are the places where you should focus your attention.
Critical Issue #5: Do you have a health concern?
If the answer is yes, again, your job is simplified, because a number of destinations that might otherwise appeal to you should be taken off your list. Like moving with children and being certain that you don’t want to learn to speak even a little of a new language, having a health issue sets your top priority for you.
Critical Issue #6: Are you disabled in any way?
The reality is that this is perhaps the most limiting situation of all. If you have a health concern like diabetes or a heart condition, you’ll want to be sure that you’re within quick access of international-standard medical care. That’s possible many places around the world.
However, if you have a disability, certainly if you rely on a wheelchair for getting around, your options can be fewer, depending on the size of your nest egg. Most of Europe, for example, is at least as handicapped-accessible as the United States. If you’re looking to make this move on a tighter budget, though, you must understand that most of the developing world, where your retirement funds will stretch furthest, is not disabled-friendly.
Critical Issue #7: What are the things you refuse to scrimp on? What do you absolutely not want to give up?
Make a list. Put the most important things, the things you have to admit to yourself you would be very unhappy to live without, at the top.
Then don’t allow yourself to be persuaded (by yourself, your significant other, or anyone else) to compromise on the two or three things at the top of this list.
You’ll have to compromise. No place is perfect, and no place is going to deliver everything you want. If you’re moving with a partner or with family, the challenge is greater; you’re trying to find a place that satisfies more than one What I Want list.
So, again, you’re going to have to make concessions. But don’t concede on your top priorities, the two or three things you identify as being most important to you.
If you do, your entire adventure could be doomed.
Critical Issue #8: Does currency risk scare you?
If so, consider countries that use the same currency as that of your nest egg or anticipated income. If your funds are denominated in U.S. dollars, for example, consider Panama or Ecuador… or perhaps Belize, which doesn’t use the Greenback but which pegs its own Belize dollar to it.
Now, you may be thinking… but what if the U.S. dollar tanks? What good will it do me, you could wonder, to be living in a country that uses dollars if the dollar becomes worthless?
You’ll be no worse off than you would be if you were still living in the States. Prices for most things will go up, just as they will go up Stateside.
In fact, you’ll have the same inflationary issues from a collapse of the U.S. dollar no matter where you’re living, in a country that uses the U.S. dollar for its currency or in any other jurisdiction.
Say you retire to Colombia on your Social Security check, and, three years later, the U.S. dollar collapses. What happens? The cost of things for you in Colombia in dollar terms will go up… just as it will in dollar-denominated markets. In Colombia, though (and elsewhere), you’ll also have currency exchange ups and downs to consider and ride out.
The key is diversification. If you have any assets beyond a Social Security check, diversify them among more than one currency.
Critical Issue #9: Are you ready to move full-time… or would you like to take the idea of retiring overseas for a test run first by spending part of a year someplace foreign?
This doesn’t have to be all or nothing. You could launch a new life overseas and still spend part or even lots of your time back home.
I make the point in case it hadn’t occurred to you already. The idea of moving to a new country, full stop, full-time, can be intimidating. Selling your current home… off-loading your car, your furniture, your lawn-care equipment… flying off to a new country where you know no one and where everyone you meet speaks another language? Boiled down like that, this live-overseas agenda can seem foolish, even terrifying.
So don’t sell your home. Keep your car if you like it. Lock the lawn mower in the garage. Pack a few bags and head off to someplace that’s got your attention for, say, a month or two. Don’t even think about buying a house or anything else. Rent small and modest. Or arrange an extended stay in a bed-and-breakfast or guesthouse. Keep it low-key and low-pressure.
This doesn’t have to be like jumping off a cliff. You can ease into the idea. Then, if you find the place you take for a test spin disappointing in some way, you can return home (remember, your car’s waiting for you in the driveway)… and begin planning your next overseas holiday. Give someplace else a chance.
You could continue like this for years. You’d be enjoying some of the benefits of a new life in a new country (a maybe dramatically reduced cost of living, better weather, cheap medical care, new friends, grand adventures, plus little luxuries you probably can’t afford now—full-time household help, for example), but you’d have a safety net. What you’ll find is that, with each foray overseas, your confidence will build. And your plan will evolve.
Next step, maybe extend the length of each overseas vacation. You could spend three or even up to six months at a time in each new place, depending on the jurisdiction’s tourist visa restrictions, thereby avoiding the residency permit issue altogether.
You could begin renting out your place back home when you’re not using it. This income would help to subsidize the expense of your retire-overseas wanderings.
You could, eventually, invest in new digs in a place you decide you like well enough to want to return to regularly. Again, rent out this apartment or beach house when you’re elsewhere to further supplement your retirement income.
Maybe, eventually, you find you’re ready to sell your place back home, because, as time passes, your connection there seems less and less important. More interesting are the new places you’re discovering, the new friends you’re making, the new adventures you’re having…
Take it one step at a time and let your go-overseas plan develop organically. Just as there’s no one-size-fits-all overseas haven, neither is there a live-overseas plan that suits everyone. This idea is infinitely customizable.