Retirement is different for everyone and the quality of your retirement can be dependent on where you live. For some, that may mean moving to a state that doesn’t tax income such as Florida or Nevada.
For others, it can mean moving abroad and living in a lower cost country that can provide a better standard of living for the dollar. The type of people living abroad can appeal to are fixed income retirees such as pensioners, social security beneficiaries and military veterans. These fixed income retirees have a significantly better quality of life abroad on a monthly income of $2,000 to $6,000 a month. In the US the same income level barely affords you a quality of life above the poverty line or in the middle class, but in a country such as Colombia you would be in the top 1% richest of citizens.
We have traveled extensively in Latin America and one country that stood out to us is Colombia. Some positive qualities of Colombia are:
- Large expatriate communities in the cities of Medellin and Bogota.
- Favorable visa policies for Americans, which allows US passport holders to stay 180 days a year on a tourist visa and extremely affordable resident visas.
- Weather that ranges from 50 to 65 in Bogota and 63 to 80 degrees in Medellin every day of the year.
Additional draws of a country like Colombia are the buying power of the US dollar, $1 US dollar worth roughly $3300 pesos at the moment. The Peso has been in free fall over 2018 and 2019, while the cost of living for US dollar earners has dropped 20%. The Peso has been affected by falling oil prices, geopolitical events and the strength of the US dollar. The cost of living in Colombia tends to be 1/3rd compared to the US depending on the location you choose to live in. It is common to rent a relatively new 2 bedroom apartment for less than $1000 dollars a month, or even buy a 2 bedroom apartment for $70,000 to $130,000.
Not to mention universal health coverage called EPS, which costs a few percent of your monthly income and provides free medical care for participants. Retirees tend to worry about the cost of health care in the US and it is one of the least planned for retirement expenses when we speak to clients. In Colombia it is common to have a free hospital visit or extremely affordable care (less than $100) with national medical insurance “EPS”. Before retirement you should explore alternative countries to live in and weigh all factors associated with living abroad.