There's no such thing as "the best place to retire overseas." Nowhere is perfect, and certainly no single choice would be perfectly suited to every would-be retiree. Your ideal place to retire overseas depends entirely on what you're looking for.
I'd name Panama City, Panama, and Medellin, Colombia, as two of the best places in the world to think about retiring right now. At the same time, these two cities couldn't be more different from each other. You might even call them the retirement haven yin and yang of each other.
I've been spending time in Panama City for about 15 years and living here full time for five. I know this city well, both its pluses and its minuses.
Arriving in Panama City, you recognize instantly that this town is open for business, pushing for growth and both embracing and chasing prosperity. Everywhere you look, in every direction you turn, something is being torn down, put up or rebuilt. Your heart rate quickens, and your mind works quicker, too, trying to keep up with the commotion all around.
I discovered Medellin more recently, about three years ago. This city has the opposite physical effects. Touching down in Medellin, your heart slows a bit, your mind settles.
Unlike Panama City, Medellin's cityscape isn't all high-rise condo towers built of glass and steel. Most every structure in Medellin is of red brick, topped with a red clay tile roof and surrounded by foliage and flowers. This is a city of parks and green spaces. The effect, again, is calming, peaceful.
You can learn a lot about a place both from and by its taxi drivers. They're a top source of getting-to-know-a-city information and insights, of course, but they're also a barometer of the mood of a place. In Panama City, taxi drivers are in a hurry. They honk their horns constantly. They weave in and out of traffic, from lane to lane, pushing for constant progress. They can't abide sitting still or even slowing down and tend to run traffic lights and ignore things like "Stop" signs. They also tend to be unhelpful, even rude. A Panamanian friend describes them as "among the least appealing people on earth." Based on long experience with them, I'd have to agree.
In Medellin, the taxi drivers, like their city, are gentler and calmer, happy to stop to offer directions or even to chat. In Medellin, you rarely hear the honking of a car horn, not by a taxi driver and not by anyone else either. It's also worth noting that, in Medellin, taxis are not only ever-present, but also always painted yellow and metered, unlike in many of the places where we recommend you spend time. Again, orderly... genteel.
As I said, Medellin is impressively green, with trees, plants and small gardens everywhere. It's also remarkably clean. In the central neighborhoods, you see no litter. The metro, a point of pride for the local population, is spotless and like new.
Panama is working hard to clean up and green up its capital city. The long stretch of parkland along the bay known as the Cinta Costera has dramatically changed the face of Panama City for the better (and is being expanded). Still, while one might describe Medellin as genteel, an appropriate adjective for Panama City might be gritty.
Walking around Medellin, especially outside the central tourist zone, you might feel like an anomaly. This is less and less true, as Medellin becomes more discovered by expats and retirees. However, in Panama City, Americans are everywhere. We have been part of the landscape in this city for nearly a hundred years.
From a cost of living perspective, I'd put these two cities on par... depending on the relative strength of the Colombian peso. This suggests an important potential downside for the retiree in Medellin versus the retiree in Panama City. In Colombia, someone whose income is in dollars faces an exchange risk. In Panama, which uses the U.S. dollar as its currency, this isn't an issue.
One of the biggest pluses of Medellin is the cost of real estate in this city. The real estate market in Panama City has settled noticeably from its boom-time highs of five or six years ago. Today, you can buy in this market for $1,500 to $2,200 per square meter (down from the $2,000 to $3,000 per square meter of the golden age of last decade). In Medellin, you can buy in El Poblado, considered the best address in the city, for as little as $1,200 per square meter (resale). In less central, more local neighborhoods, you can buy for less.
Panama is one of the world's most welcoming countries when it comes to establishing residency. In Panama, the would-be expat, retiree or entrepreneur has more than a dozen options for how to establish full-time residency, including the new "Specific Countries" visa option, which amounts not only to the most user-friendly, turn-key residency option in the world today but also the most user-friendly, turn-key residency option in the history of residency options. Plus, this new residency option can lead to a work permit, which is a big deal.
Colombia, too, though, offers good foreign residency options, including one for pensioners and another for investors. The minimum investment requirement in each case can be less than for comparable options in Panama.
One practical matter that is not as straightforward in Colombia as it is in Panama is opening a bank account. It's not possible as a foreigner to open a local bank account in Colombia unless you have a personal introduction to the bank. The alternative is to open an account with what's called a "fiduciary," the local equivalent of Charles Schwab. Unlike opening a bank account, this is relatively straightforward and a reasonable strategy for dealing with local bills. The downside is that transaction fees can be high.
The other downside to Medellin compared with Panama City is that few in Medellin speak English, whereas, in Panama City, it's very possible to get by speaking no Spanish.
What's the bottom line? Which city might make more sense for you? Again, it depends entirely on what you're looking for.
To help you process the factors you should process as you consider these top options, here's how I'd break all this down...
Panama City Versus Medellin:
Cost of Living: It's a tie, more or less, depending on the relative strength of the Colombian peso.
Cost of Real Estate: As much as 50 percent less expensive in Medellin.
Climate: Way more comfortable in Medellin.
Ease of Residency: Panama is one of the easiest places in the world for a foreigner to establish full-time legal residency, especially if he comes from one of the countries included in the new "Friends of Panama" visa program. However, Colombia is also a very straightforward option in this regard. Certainly, I wouldn't take Colombia off my list for fear of a complicated struggle related to becoming a resident.
Ease of Banking and Doing Business: Here, Panama wins hands down, with its international banking industry (the exchange-of-information treaty the country signed with the United States in 2010 notwithstanding); its lack of any exchange controls; the absence in this market of any currency exchange risk (as Panama uses the U.S. dollar as its currency); and its greater prevalence of English-language speakers.
Infrastructure and Accessibility: Another tie.
Taxes: Panama is the screaming champion on this score, a true tax haven, while Colombia qualifies as a high-tax jurisdiction. Note, however, that if you're a retiree making a move with retirement income, you probably don't have to care about this. Relocating overseas should be a tax-neutral event for a retiree with only retirement income (no matter where you decide to move).
Health Care: Top notch on an international scale in both cities.
Ease of Settling In: Panama City is a kind of halfway house for expats, a very easy and comfortable first step overseas. Medellin is more an emerging expat destination, though it is more discovered and therefore easier to navigate as an expat or foreign retiree all the time.
Thailand is establishing itself as a hub of quality health care thanks to its growing medical tourism. While access to internationally accredited affordable hospitals are especially important as one gets older, there are other more enjoyable parts of retiring in Thailand: great weather and a low cost of living.
The steep discounts for seniors (women 55 and up and men 60 and older) can't be beat in Panama, according to U.S. News and World Report. To qualify for lifetime pensioner status, you must have a regular pension of at least $1,000 a month. The benefits extend to everything from plane tickets to doctors appointments to hotel stays.
Living in big European cities like Paris and London come with big ticket expenses. So why not try Austria's capital city of Vienna, known for its high quality of living? Vienna recently topped consulting firm Mercer's global survey of best places for quality of life for the fourth year in a row. In addition, an annual bus pass costs only 1 euro a day, and the cost of a one-bedroom apartment is hundreds of dollars less than what it would cost you in Paris.
Small towns in Italy are not only quaint -- they can also be home to an
Picturesque areas of the country, like the Périgord region in southwest France, are great for those retirees interested in a slower pace of life and days like this one described in the Wall Street Journal: We go to one bakery for bread and another for croissants. We shop at farmers' markets for fresh eggs, cheese and garden vegetables. Our neighborhood cafe welcomes us on winter evenings at the zinc bar, and on starry summer nights on the terrace on the square, which we share with tourists as the weather warms. Lovely, no?
Malaysia has an excellent infrastructure, a large community of expats and a great social scene, according to InternationalLiving.com Asia Contributor Keith Hockton. The country is also incredibly hospitable to expats looking to call Malaysia home. A government program known as MM2H, or Malaysia My Second Home, offers a renewable 10-year-long social visit visa for eligible applicants.
The European banking crisis has thrown the real estate industry into disarray... which may be a boon for you if you'd like to retire there. Though U.S. News and World Report found that prices are all over the map, property prices in Ireland are about half of what they were pre-2008. You can buy a 2,000-square-foot modern one-bedroom home in Ireland for just $64,000.
The average temperature in the Philippines is 78 degrees! And in the last four years, Manilla has become known as a great retirement community, boasting an "American country living" feel, according to the New York Times. Correction: A previous version of this slide stated that Manilla was far away from typhoons. This was incorrect and has since been updated.
Belize is a nature lover's dream, with its natural wonders like caves, pyramids, white beaches, and clear blue seas housing coral reefs great for snorkeling. English is commonly spoken in this Central American country, making the transition easier for American retirees and expats.
"Phnom Penh is an exciting frontier city, which has surprisingly good hole-in-the-wall bars, great restaurants and fantastic French colonial architecture," Keith Hockton of InternationalLiving.com reports. The country's incredibly low cost of living can't be beat, either.
In most parts of Guatemala one could live comfortably on between $1,000 and $1,500 a month. “Guatemala offers an attractive option for retired people for several reasons,” said Glenn Wilson, a real estate agent with Century 21 Casa Nova in Antigua, Guatemala. “Among them, in my experience, are affordability, quality of life, and short travel times to and from the United States.”
The setting of so many fantasy movies could be your new dream home. Island living and all that sunshine lead to an incredible biodiversity you can explore at any one of the country's 14 national parks or 34 marine reserves. Correction: An earlier version of theis slide said that the coldest it gets in New Zealand is 50-60º. This is actually the average winter high.
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