Monday, May 14, 2012

Rretiring To A Tropical Paradise On $1,200 US Per Month?

  My dear readers I opened up Yahoo early Friday morning and read a banner headline saying that one could still retire to a paradise for around $1,200 US per month. I read the article in detail. It extolled the virtues of Panama and the small seaside village of Las Tablas. It all sounded so wonderful and tempting.

      This came one day after another shocking headline stating that the average person retiring in the US and covered by the financially-strapped medicare program would face $240,000 US in "out of pocket " medical costs before the end of life.

      If my wife were not still employed as a medical doctor I would be facing retirement on a monthly Social Security salary of $1,254.00 US. Here is the San Francisco Bay area, I could rent a room for $500 US to $600 US per month. I could pay for food, a couple of tanks of gas in my 6 year-old Saturn, auto insurance, and a cheap cellular phone. I could not afford private medical insurance. Since I am a military veteran I would qualify for medical care with the Veteran's Administration. Basic care would be covered but I certainly could not get a heart transplant at the VA Hospital, for example.

       On the other hand I could go to Bariloche, Argentina, and rent a furnished apartment for about $550.00 US per month.  I could use the excellent public transit system. Food would cost a couple of hundred per month. Medical care would range from full-coverage medical insurance with Swiss Re for $392 US or just a pay as you go system that would be cheap. If I wanted to go to where my son lives in Goiania, Brasil my costs would be about the same. In both places I would have a better social and family life than here in the San Francisco area.

     Many of you will seriously consider retiring to another country. Thirty or forty years ago there were tropical paradises where one could retire cheaply. Sadly the rest of the world has become more prosperous and the dollar has declined against major currencies. All of a sudden these paradises have become expensive.

     You also have the challenge of meeting immigration requirements of the country where you want to settle. Let me give you a couple of examples as follows:

-My dear wife Elena arrived in February, 2001 in San Jose, California as a tourist. In June of 2004 she proudly became  U.S. citizen. The total bill for this transformation including lawyrs, fees, etc. was $30,000 US.

-In 2007 I started the process to become a permanent resident in Argentina. In January of 2009 I got my DNI book and was officially declared a permanent resident of Argentina. The total cost of this legal process including trips to and from Argentina was over $13,000 US.

     In both of these cases a foreigner was married to a local citizen. If you are not married to a local citizen the process becomes far more expensive and challenging.

    I have lived on six of the seven continents. At various times in my life I have been a permanent resident of Brasil, South Africa, and now Argentina. In most countries I have been to, you can live just as well as you would live in the USA but it will cost about the same with the exception of cheaper medical care. Yoiu can live like a lower-class local person for a low wage but it would not be a pleasant life. You certainly would not want to depend on the public medical system in most countries.

     Let us go back to the example of Panama. This country is booming and becoming a major banking center for all of Latin America. Life in Panama City would be just as expensive as life in a major American city. Life out in the seaside town might be cheap but you would live like alower-class Panamanian. If you depended on the local public health carre system you would get slow care and questionable quality.

    Let us now look at retiring to Argentina. If you are not married to a local citizen you will face minimum legal fees of $4,400 US+ You will have to produce a lot of documents. You will have to prove that you have the resources to support yourself in Argentina. It will be a tough year to work your way through the bureaucracy and you will have to learn to speak Spanish.

       Once you're accepted and ready to move, your US appliances will not go with you as they are all 110 volts. All Argentine appliances run on 220 volts. You might be able to take your computer. The cars there do not run on lead-free gas. Your car is gone. Cars are more expensvie in Argentina than the USA. A decent car will cost you between $12,000 US and $25,000 US. It will be cheap to move your furniture in a cargo container on a ship. You will need a skilled customs broker to get you through the corrupt and arbitrary customs service.

   Once you arrive you will need a good real estate agent to find you an apartment or a home. In Buenos Aires, there are several real estate agents who speak good English. The same cannot be said out in the provinces. You will find rents cheap by US standards. Housing in Buenos Aires will cost about the same as housing in Miami. In Bariloche housing costs will be the same as San Francisco. You will also need a good lawyer to guide you through all of the bureaucratic hurdles. The US Embassy will be able to assist you here.

    You will then have to make decisions on medical care. Argentina has doctors of varying quality. My wife graduated fromn the University of Buenos Aires Medical School with an honors diploma. When she got to the USA, she scored in the top 5% of medical school graduates taking the test for a medical license. She was up there with graduates of Harvard and Stanford Medical Schools. If you Google "U of Buenos Aires Med School graduates in the USA" you will get a big list of Argentine doctors who have come to the USA and had great careers. Other doctors do not have this high quality.

        Argentina has an extensive public mediucal system. Report sof its quality range from abysmal to good, in spots. It is best to go with an insurance company called Swiss Re. Their doctors are high quality and many speak English. At 63 years of age with slight overweight and cholesterol issues my monthly fee would be $392.00 US.

        As you can see from all of this retiring to a foreign country is neither cheap or easy.