Category: Financial Planning

Living abroad after retirement – A know-how

Retirement used to mean settling down, but for some it now means jetting off.

Retirement is increasingly a stage of life when people undertake great and bold migrations – People in their 60s are looking to retire but they’re often cash-poor and living in a country with a high standard of living and prices to match. For some, retiring overseas is an option, but it pays to do your homework.

South-East Asia and Europe are brimming with people from all over the world who have chosen to move in retirement.

Across South-East Asia in particular, the big attraction is an affordable lifestyle. The cost of living in Thailand, for example, is a fraction of that in the West. An enviable standard of living at a frugal price is the goal. It could well be the difference between a retirement spent watching your pennies go or one where you can relax.

“People who are running away from problems at home often and the same problems here, those who haven’t done their homework can become quickly disillusioned”. After a few years, the novelty wears off and they move on.

Planning carefully makes a world of difference.

Money matters !

– Get the right credit card

– Leave all your investments at home , where they earn interest

– Embrace renting and pre-owned movables at your destination

– Keep most of your cash in a home country bank which has offshore branches

– Take Cover – Health cover (local one is probably cheaper), travel insurance, etc

– Plan for Visa / residency requirements (cost effective)

– Plan / provision for tax expenses

Organizing your assets and taxes before you move

# Hire a financial adviser , It’s almost impossible to find someone who knows the laws of every country, so find someone who specializes in your chosen country.

# Keep your home bank accounts and open a new one when you move – Ask your bank if they charge a fee for making withdrawals from foreign automatic teller machines; if they do, you might want to upgrade your account or change banks before you move. Embrace online banking

#Tap your home for a source of income as rental – If you’ll be leaving behind a home you own, you may not want to sell it at first. But you could consider renting out all or part of it. Some retirees use Airbnb to flexibly get income from their home, while reserving its availability for when they come back to visit.

# Plan for healthcare , So paying for health care expenses out of pocket or buying local insurance or a hospital membership plan may be reasonable, with many expats saying they pay under $100 a month.

# Insure everything else –  It’s a good idea to consult your local real estate agent about what insurance policy to get.

#Get a financial power of attorney – You may need an adult son or daughter, or other representative, to make financial moves in your place while you are overseas. It’s a good idea to leave them with a financial power of attorney document so that they can sign for you, for example, while selling property or other investments.

# Tax –  While some retirees may not owe any income tax while living abroad, they must still file returns annually . This would be the case even if all of their assets were moved to a foreign country. The bottom line is that you may still be taxed on income regardless of where it is earned.

Retirement income is generally not taxed by other countries. As a citizen retiring abroad who receives Social Security / pension / gratuity / rent / interest ,etc , for instance, you may owe home country taxes on that income, but may not be liable for tax in the country where you’re spending your retirement years. You may also be required to report and pay taxes on any income earned in the country where you retired. Each country is different, so consult a local tax professional or one who specializes in expat tax services.

Where to ??

But how do you choose? The Retirement Index is still the most comprehensive and in-depth survey of its kind. Here are some bigger and ever-growing selection of outstanding destinations where you can live a healthier and happier life, spend a lot less money, and get a whole lot more.

Thailand – Southeast Asia offers some of the world’s most attractive retirement programs, astounding geographic and cultural diversity, and climates to suit all tastes, ranging from hot beach resorts to cool highland hill stations. You’ll find sophisticated cities, ultra-modern, affordable healthcare, and luxury accommodation for a fraction of the cost . Thailand generally has a tropical humid climate. No cold winters here. Perfect for people who like swimming and sunshine. Arthritis sufferers find great relief in this climate. There are many modern private hospitals in Thailand.

The most enjoyable parts of Thai culture revolve around the idea of sanook (meaning “fun”). Whatever you find yourself doing, you are encouraged to make it fun and enjoy every minute.

Peru – While 95% of people who visit Peru do so to explore Machu Picchu, many have discovered an ideal retirement destination, with miles of beaches, delicious cuisine, and some of the lowest costs anywhere when it comes to enjoying a high-quality lifestyle. Spectacular Macho Pichu, Cusco, and the Sacred Valley of the Incas have always been major attractions for tourists, but more expats are now heading to this area for long-term stays and retirement. Nights are cool, but midday highs can reach the 70s F for much of the year.

The capital city of Lima is home to the largest number of expats. They enjoy some of the best restaurants in the world, a large variety of art galleries and museums, a vibrant theatre scene, and the easily accessible international airport. And for anyone breaking into Peru’s business world, Lima is the place to see and be seen.

Malaysia – Idyllic beaches, islands that seduce the senses, and some of the most pristine ancient rainforests in Southeast Asia—this is Malaysia. And these are just some reasons why many call it home. The other attractive thing is the outdoor lifestyle. If white-sand beaches are your dream, you have here more than 878 islands to choose from!  With all year-round good weather, the temperature in Malaysia averages 82 F, there are over 60 hiking trails for us to choose from. Apartment rentals here are good value and you can choose between sea and mountain views. In Batu Ferringhi, a nice beach suburb, you can rent a three-bedroom, apartment with sea views. The unofficial first language of the country is English, so you don’t have to learn another language here if you don’t want to.

+Retirement Index Card

Sneha Ramamurthy

Dilzer Consultants Pvt Ltd