Retiring abroad is an option you may not have considered, but it’s one that can have several advantages.
Making a move to another country can often help your retirement savings last longer while upgrading your standard of living. And if you’ve always wanted to see more of the world and experience another culture, you’ll finally have the chance to do it.
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It's an increasingly popular choice, with the number of retirees drawing Social Security outside the U.S. jumping 40% between 2007 and 2017. If the idea of retiring abroad sounds intriguing, check out these tips:
Research lists of the best places to retire
Websites such as internationalliving.com and liveandinvestoverseas.com compile a list of the best places to retire, using factors such as cost of living and climate. Their lists can be a good starting point, and in case you're wondering, Portugal tops both lists for 2020.
Explore your health care options and costs
Health care becomes even more important as you age, so you’ll need to make sure you understand how you’ll access quality health care — as well as its cost — if you retire abroad. This can vary by country and even the city or region you move to.
Bank of America suggests researching doctors and health care facilities in your potential destination and understanding what health plans you may be eligible for. In some countries, private health insurance is cheaper than in the U.S., and some may let you buy into their national health plans if you hold a permanent resident visa.
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Rent before you buy
Don't buy a house or apartment in another country until you give yourself time to see if you really like the area, cnbc.com warns. Research can certainly help you make a good decision, but you never really know whether you'll thrive in a new destination until you live there for a while.
Start by renting in a hotel and then if you’re still undecided, move to a furnished rental. That way, if you decide the country and area aren’t for you, you won’t have to worry about selling a home or apartment or moving your furnishings.
Calculate your cost of living
Many people consider their housing costs when they move to another country, but you should also take a close look at your entire budget. Your housing and health care costs may be cheaper abroad, but there are other things to consider. For example, utilities, transportation and groceries could cost more than what you're spending on these categories in the U.S.
Taxes should also be considered, according to msn.com. Most countries have tax agreements with the U.S., and the rules for retirement income can be complicated. As you consider a possible move, consult with a tax advisor first.
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Research possible language barriers
To truly immerse yourself in a new culture, you'll need to speak the language, says northwesternmutual.com. The site recommends taking language classes or learning from an app.
If you don't know how to speak any of the country's native language or aren't confident in your ability to learn it, the site recommends retiring in a country where English is a strong second language. Check out the EF English Proficiency Index to find a ranking of countries and regions by their English skills.
