No Two Retirement Lifestyles Are Created Equal

Friday, we began revisiting the all-important cost of living question.

It’s nearly impossible, I explained, to say how much it would cost you to live in a place, because your cost of living anywhere depends on how you want to live.

It’s almost not possible, even, to tell you if a place is “cheap” or “expensive,” for those are relative ideas. What’s affordable to me may be costly right now to anyone living, say, in Detroit, where whole houses are reported to be changing hands for US$7,000 or US$8,000. From that vantage point, the entire rest of the world must appear over-priced.

This is perhaps the most asked-about issue we address in these dispatches.

“How much would it cost me to live in Belize?” readers write.

“I have a retirement budget of US$1,400 a month. Could I afford to retire to Panama City?’

“My wife and I have US$2,500 a month in retirement income. Where will that buy us a luxury lifestyle?”

The first big question you must address as you shop the world for the retirement haven with your name on it is this one: What kind of lifestyle will your retirement budget buy you where?

As you work to answer this question, understand one important thing:

No two retirement lifestyles are created equal.

I’ve reported that it’s costing us nearly US$5,000 a month to live in Panama City (US$4,765 is the figure I’ve quoted).

Would it cost you US$5,000 a month to live in this city? I doubt it. Remember:

  • We’re a household of four…which means we’re buying groceries for four…
  • We’re renting (and air conditioning) a four-bedroom place…we need all this space because our residence is right now doubling as our place of business (though we’re outgrowing it and plan to move into separate office space soon)…
  • We’re in a brand-new building in a nice neighborhood, and we’ve got an ocean view…
  • We’re paying for a super-duper cable/Internet package that costs nearly five times as much as a basic package…
  • We have a full-time maid…but maybe you need only part-time help around the house…
  • Etc.

We have friends living in Panama City, comfortably, on US$1,500 a month and less.

Lief and I have been spending a lot of time out in Veraguas Province lately, on the west coast of the Azuero Peninsula, where Lief and a partner are developing land. What would it cost you to live in that beautiful region of this country?

You could rent a house for US$300 a month or less…maybe half that.

Groceries are cheaper than in Panama City by at least 10%. And you can eat lunch or dinner out in the local road-side restaurants for as little as US$2.50 a person.

You’d have to invest in a satellite dish if you wanted your own Internet access. And your biggest expense by far would be a vehicle.

I haven’t tallied the costs carefully (I’m working on that and will report back), but I’d say you (that is, you and a significant other) could live comfortably in this Pacific coast paradise for less than US$1,000 a month, maybe much less.

The real question, though, is: Would you be happy living out here? You have to answer that one for yourself

Kathleen Peddicord