Where to Retire at 35
By Cecilia Frederick
If you could live anywhere, where would you live?
It's a question worth considering seriously, because the truth is, you could.
No matter your current circumstances--be you 30 or 70...single or married 40
years...with children or not, young or grown...active business interests or
passive investments to manage...a million dollars worth of assets or nothing
like it--I promise you: I know others with similar life stories who have taken
the leap and who are, as you and I consider the possibilities right now, already
living their dreams in their chosen Shangri-las.
To get from where you sit now to where you'd like to be, you've got to do two
things.
First, get up.
Second, figure out where you'd like to be. This is where the trouble starts. The
more you open your mind to the possibilities, the more confused you're likely to
become. How did Alex and Judith choose Panama over the dozens of other countries
they considered carefully? Why did Jay Snyder and his wife decide to spend their
time and their money in Granada? What's Paul Keppler doing in Istria?
I'll let each of them tell you their stories themselves, over time, in these
dispatches. In each case, the reasons have something to do with business and
investment...and something, as well, to do with fun and adventure. But, without
exception, the common denominator is that they all wanted a change...a chance to
start over, to try something else, to be someone new...to enjoy a richer, fuller
quality of life.
It's cliché, on the one hand, but, on the other, it's the only point worth
making...the only agenda worth remembering: You've got one shot. Make the most
of it.
I'm preaching to the choir, of course, and you know as well as I do the
fundamentals of this conversation. You've got to consider cost of living (and of
real estate), health care, telecommunications and other infrastructure, ease of
coming and going and of getting around once you're in the country, taxes, the
local language, the safety of the cities, the stability of the government, and
the weather...these are the boxes to check...or not.
And that's one approach to take when trying to answer the question I posed
earlier. Assuming you could live anywhere, one way to find out where you should
go would be to create a spreadsheet. Into the rows and columns, you could place
checkmarks. No, Nicaragua does not have reliable infrastructure...yes, Mexico is
easily accessible from the States.
Or you could create a ranking system. Panama is accessible (give it an 8 out of
10) but not as accessible as Mexico (10), while New Zealand is on the other side
of the planet (2).
Lief and I have done this work, as has, each in his own way, everyone I've
introduced you to in this e-mail...and you should, too.
Then, when you've finished the exercise, toss your spreadsheet aside. You've got
to allow for the things that can't be plugged into it. Unless you lack any
adventuresome spirit or romantic soul whatsoever, this isn't a question that
number-crunching can answer for you. At least not completely.
Take Waterford, Ireland, for example. It spreadsheeted much better a decade ago,
when Lief and I first established residency there, than it does today.
Back then, before "Rip-off Ireland," it was still affordable. Real estate values
had been climbing for a decade already at that point, but they were still
reasonable on a world scale. Foreign residency was possible in several
straightforward ways, and it could lead to citizenship. And as foreign
residents, we paid tax in Ireland only on the money we remitted to Ireland.
Americans abroad, we mitigated our U.S. tax bill with the help of the foreign
earned-income exclusion, then we brought into Ireland (and therefore paid Irish
taxes on) only the money we needed to live on each year. Talk about
tax-efficient.
Today, the cost of living on the Emerald Isle is absurdly high (even Waterford
can be more expensive than Paris), and the country's real estate bubble is the
stuff of urban legend. They've made it tougher for foreigners to take up
residency (in an effort to curb the migration from Africa and Eastern Europe).
And they've changed their tax laws so that foreign residents are today taxed on
worldwide income. Yikes.
Ten years ago, Ireland would have come out tops in most anyone's rankings. Today
its score would be less impressive. Especially when you remember the bad weather
and the broken-down infrastructure.
Yet, my position on Ireland hasn't changed. I enjoyed our life in the country
when we began it more than 10 years ago...and I'd consider returning today.
Lief wouldn't--the new tax laws are too much for him to take--but I maintain
that one can't organize his entire life according to tax code.
For me, Ireland's appeal, 10 years ago and still today, has to do with its
history, its pastoral landscapes, and its country charms...the castles, the
gardens, the Georgian style...
Things that are hard to rate and rank.
Paris boasts the world's best health care (according to the World Health
Organization), world-class infrastructure, four seasons, and more entertaining
and pleasing ways to spend your time than any other place on earth. I appreciate
those things, of course, but my reasons for considering Paris one of the best
places in the world to call home are less quantifiable. I like being in Paris
because it's beautiful and ever-changing in ways you've got to pay close
attention to recognize. Paris is a city you can know well and still delight in
discovering anew every morning.
On paper, Panama City is hard to beat. Affordable cost of living; good medical
facilities (I can vouch for these from personal experience); good
infrastructure, especially for the region; a tolerable tax system for foreign
residents and reasonable options for becoming one in the first place.
Yet, Panama City isn't for everyone. It's hot, humid, and dirty. Its expanding
population struggles morning, noon, and night to travel back and forth on the
city's one main thoroughfare. Don't try to drive in this town if you can't
control your temper. Remember, this is a developing nation...not a developed
one. And, again, maybe that doesn't work for you.
I'm aware of all these things, and still I'm looking forward to our move to
Panama City this summer, in part because the cost of living will allow me to
have help around the house and a driver (almost a necessity)...in part because
our tax life will become again very efficient...
Mostly, though, I'm as excited about this move as I have been about the others
over the past decade because I appreciate the energy in Panama right now. This
country is at a turning point in its history, pushing full steam ahead toward
developed world status. Hard to be at rest and rotting in a place working this
hard and moving this fast to make something of itself. I feel fortunate that
I'll be able to be a part of it for a while.
Kathleen Peddicord
After more than 22 years as Editor and Publisher of International Living,
Kathleen Peddicord is now Publisher of
http://www.liveandinvestoverseas.com and Editor of the group's FREE weekly
e-letter, the Overseas Opportunity Letter, detailing the best opportunities
worldwide right now for living, retiring, investing, owning real estate, and
doing business. Nobody covers this beat better.