Places Where You Can Retire on $200,000 and Feel Rich

[daletournier]

Originally Posted by Scatterling

Also the 15th most dangerous city in the world according to Wikipedia.

Yes this is true BUT its mainly certain pockets you dont go to. I spent a delightful 3 mths there and didnt feel in danger and I know what danger feels like. Remember millions live there with out a problem.

[john61ct]

And statistics on local-on-local crime can often be irrelevant to the actual risk of danger to foreigners and expats.

Unless you put yourself in harm's way getting involved in risky business, as many expats do.

Romancing the daughter of a politically powerful family, for example police / military mafia, can be more dangerous than dealing drugs in cahoots with them.

Local knowledge is everything. . .

[Scatterling]

Originally Posted by daletournier

Yes this is true BUT its mainly certain pockets you dont go to. I spent a delightful 3 mths there and didnt feel in danger and I know what danger feels like. Remember millions live there with out a problem.

If you dont venture beyond the V&A or go out after dark. Millions also lock themselves behind high walls. I'm from there, and I dont know anyone who has not been impacted by crime.

[bobfnbw]

Thanks for posting this Gord. Been on my mind a bit lately. I have 315 days to go to retire and Where to retire is a big issue on my mind. Will have to stay in the states (Texas) for a bit and just drive my 40 foot Foretravel RV around, but I don't think I can sustain that lifestyle for long here. After my last sailboat sunk, I was off boats forever, but now thinking again of either a motorsailer or a trawler. And where to have it is a big question in my mind. I already know thru firecalc and the post retirement calc that I should be fine for living the next 20 years with my SSI. If that goes away, there are options but don't want to think about that. Wife being a bit younger than me, needs to work a few more years to qualify for her teachers retirement so there will be a gap there where I am jobless and she is still working. The difference is, she enjoys her job while I hate mine. In fact I know that the longer I stay in it the less likely I will survive the 20 years I expect to live in peace.
Southeast Asia is high on my list with Malaysia being number 1, Thailand #2 and Vietnam#3. Being on a boat will allow travel to all those countries plus the Philippines, Australia, and Korea/Japan. Of course will have to come back once or twice a year for the kids. And marriages and deaths. But hopefully that won't happen much.
The other place I think about often is Mexico. The Baja peninsula. But it would be a distant 2nd place to SEA.
Rich is a curious word to use and I read that people seem to have some issue with it. To me, being rich means keeping up with the big time joneses, living large. Being content, having enough to do what I want, while not having to go to work every day, that I want I want. People I work with, even those that could have walked away years ago, don't seem to understand what that means. They worry about paying high dollar for health care, power, internet, having 2 cars with insurance, paying the mortgage or high cost of RE taxes and insurance. They can't see another way. So they work, till they get sick and die. Seen it all to often. Sad.
I always said you can live a lifetime in 10 years, and 20 would be better. Hope to start that up soon. Just wish my wife was 4 years older...lol.
Also wish I had saved more, but whats done is done. I will/should have enough for what I need to do. And if I make it to 82 kids might have some left. If not they are young.
Hope to see some on you on the beach.

[barnakiel]

I will not mention other places (I did visit many on the list) but I will make a comment on Spain, where we live now. We are in Canary Islands which are probably one of the 'cheapest' Spanish places to live.


Now what the article proposes is 100% not true and I think completely misleading.


Start with the net amount of 200k USD repeat USD. Convert now to EUR and deduct FX and receiving bank charges:


USD 200k = EUR 160k


Renting a VERY BASIC apartment (about 500 sq ft) ex power and services costs EUR 600 per month. Make it EUR 1000 per month with services, wi-fi and other such likes.


FOOD is inexpensive here BUT the way to eat is to eat out which will put you at about EUR 50 per day. Round this up and stay home on bread and WINE at times and make it EUR 1000 in food, medicine,cosmetics, toilet paper, a concert or movie ticket now and then a if you wear jeans PLS make sure you know they cost EUR 25 and upwards here (designer's 100 EUR and upwards) and other such like CONSUMABLES.


This makes about EUR 2000 per month. Yes yes yes you believe and you are so smart gravity laws do not apply and you will make it with 66.66% of the proposed monthly sub-total. OK and you will spend say EUR 1500 each month (just remember no flying home and no Remy Martins (which will suck, as you will have to watch me sipping one).


12 x 1500 = EUR 18k per year.


OK, let's make it 20k eh? Or are you one of those small Chinese people who actually do know how to live within modest means?


Add 2% on your savings account minus 1.28% of inflation. Etc. etc. we all know how to do the basic annuity / etc calculations, eh? I do.


And you are not going to visit any doctors, eh? No? Again: sure no?


Because you know doctors and old age ... have you looked up the google data on what the annual cost of medical material / services for a very old person is in Europe is ( and yahoo readers are unlikely European, or else they would not calculate things in USD ccy).


End of rant.


Just forget it. Unless you expect to live less than 10 years, live in crappy suburbs full of bloody noise (Spain is the most noisy country in Europe) and remain healthy now and for ever.


And I also know Slovenia pretty well and can tell you yahoo 'reporter' was as wrong about that country too.


Asia, maybe. Can't say. never been.


To retire in Spain and have a good life, you want EUR (not USD) 500k to 1m.



Cheers,
b.

[sailorboy1]

Originally Posted by tkeithlu

Carrabelle. 0.92% on cost of living relative to the nation, WAY below Florida. Easy access to the golf, a vibrant community of people with very little money. Useable building lot within walking distance of everything available for less than $15K. Mobile homes and RVs welcomed. Details if you want them.

been docked here a couple days now on a 1 month planned stay

it's looking like a good budget cruiser stop, but not looking like an inexpensive or great long term place to stay

[a64pilot]

Originally Posted by Mike OReilly

That seems a rather binary perspective A6. I suspect there’s a lot of grey in there — just like the rest of life.

If I understand what you mean by Grey, then yes there is, there has to be, reason is we have never been where we are financially so far as the economy, and I am the furthest thing from an expert, but there are so many basically illogical things going on now, in order to be nearly certain of being solvent as an old man, you have to structure your finances so that most likely they will continue to grow, in order to cover possible and I think very likely events, however I was also pretty sure that we would start to have inflation and therefore higher interest rates 15 years ago too, further proving I don’t know what I’m talking about

Living and becoming comfortable with living on a lot less may in fact turn out to be a better Retirement plan than trying to ensure there is enough money to cover a higher standard of living.

The ones I have always felt that were living dangerously are the ones that plan on Retiring owing large sums of money, they may not have the Retirement they think they will.

All my opinion of course.

Years ago my Father and I built a Mobile Home park, he told me one day that there was absolutely nothing wrong with living in a Mobile Home, but it was sad watching older people having to move back into one.
That was back in the 70’s with very high inflation and interest rates. Home Mortgages were insane then.

So what caused that then, and why are things so different now?

[hellosailor]

Dave-
I wonder how much of that interest rate difference is magic, or how much is really just countering for their domestic inflation rate, versus the dollar's inflation?
Generally, if you can get 4% annual return on your stash, that's more than most in the US, unless you are playing somewhat risky or getting insider information. Conservatively, it could be hard to get even 4% these days and retirement stashes often have to be figured conservatively, since you're retired and can't replace them.
4% on $200k is eight grand a year, I believe. $666 per month. Anything above that and you've got to start figuring against life expectancy and diminishing the principal, whichever way you want.
So, yeah...In how many of those countries can you live how well, with medical care, long term care if needed, and whatever else on $666 (before taxes!) per month?
Of course if you're an American and that $200k wasn't invested in a tax-free retirement account, you'll immediately lose some 25% ? to federal taxes until after you renounce your US citizenship. Which is permanent.
Darn, now that's $500 gross per month. Been a long time since that paid the nut.

[belizesailor]

Originally Posted by hellosailor

Dave-

I wonder how much of that interest rate difference is magic, or how much is really just countering for their domestic inflation rate, versus the dollar's inflation?

Generally, if you can get 4% annual return on your stash, that's more than most in the US, unless you are playing somewhat risky or getting insider information. Conservatively, it could be hard to get even 4% these days and retirement stashes often have to be figured conservatively, since you're retired and can't replace them.

4% on $200k is eight grand a year, I believe. $666 per month. Anything above that and you've got to start figuring against life expectancy and diminishing the principal, whichever way you want.

So, yeah...In how many of those countries can you live how well, with medical care, long term care if needed, and whatever else on $666 (before taxes!) per month?

Of course if you're an American and that $200k wasn't invested in a tax-free retirement account, you'll immediately lose some 25% ? to federal taxes until after you renounce your US citizenship. Which is permanent.

Darn, now that's $500 gross per month. Been a long time since that paid the nut.

I know several expats living on less than $1K/month in Guatemala and Panama. They are just getting by, but could not afford to live in the USA. Unexpected major medical would be a problem for them.

[redneckrob]

Originally Posted by hellosailor

Dave-
I wonder how much of that interest rate difference is magic, or how much is really just countering for their domestic inflation rate, versus the dollar's inflation?
Generally, if you can get 4% annual return on your stash, that's more than most in the US, unless you are playing somewhat risky or getting insider information. Conservatively, it could be hard to get even 4% these days and retirement stashes often have to be figured conservatively, since you're retired and can't replace them.
4% on $200k is eight grand a year, I believe. $666 per month. Anything above that and you've got to start figuring against life expectancy and diminishing the principal, whichever way you want.
So, yeah...In how many of those countries can you live how well, with medical care, long term care if needed, and whatever else on $666 (before taxes!) per month?
Of course if you're an American and that $200k wasn't invested in a tax-free retirement account, you'll immediately lose some 25% ? to federal taxes until after you renounce your US citizenship. Which is permanent.
Darn, now that's $500 gross per month. Been a long time since that paid the nut.

You sound like you might benefit from a few conversations with an accountant or good financial planner..... you're working off a lot of incomplete information. Take taxes. Assuming you've saved this $200k over your working life, which we all seem to be going with here vice lotto winner, you already paid taxes on that principal. You would only pay taxes on, in your example, an income of $8,000 a year. The marginal federal rate on that is 10%, not 25%, but given that it's lower than your standard deduction your actual realize rate is a whopping 0%. In the face of that, talk of renouncing citizenship is a bit extreme, no?

[hellosailor]

rob-
Actually a barista would help more than a CPA. I keep forgetting about our recent rate changes. Thanks for catching that.
And, I'm not licensed to practice math across interstate lines.
But the citizenship thing has been big in recent years. No matter what your tax rate, there are more and more expats or travelers who really just don't want to pay taxes when they're not working inside the US. (Or at all.) And the numbers who have gone to the trouble of just renouncing citizenship just to get the fingers out of their pockets really would fill some stadiums.

[belizesailor]

Renouncing USA citizenship is big step, but I know a few who have...mostly for tax reasons, some for philosophical reasons, some for political reasons (cant run for political office in some countries w dual citizenship). But, you have to be a citizen of somewhere in today's world so where becomes the second big decision.

[wingssail]

Originally Posted by hellosailor

Dave-
Of course if you're an American and that $200k wasn't invested in a tax-free retirement account, you'll immediately lose some 25% ? to federal taxes until after you renounce your US citizenship. Which is permanent.

No, You have assumedly already paid taxes on the earnings from which you got the $200,000 to invest.

Our US income taxes, on our income, including SSA, dividends, and capital gains, given the standard deductions, etc, is $0.

And after 10 years the $200,000 is still intact and it seems like it is sufficient.

I'm keeping my citizenship, I may need to use Medicare someday.

[Mike OReilly]

Originally Posted by a64pilot

If I understand what you mean by Grey, then yes there is, there has to be, reason is we have never been where we are financially so far as the economy, and I am the furthest thing from an expert, but there are so many basically illogical things going on now, in order to be nearly certain of being solvent as an old man, you have to structure your finances so that most likely they will continue to grow, in order to cover possible and I think very likely events, however I was also pretty sure that we would start to have inflation and therefore higher interest rates 15 years ago too, further proving I don’t know what I’m talking about

Living and becoming comfortable with living on a lot less may in fact turn out to be a better Retirement plan than trying to ensure there is enough money to cover a higher standard of living.

The ones I have always felt that were living dangerously are the ones that plan on Retiring owing large sums of money, they may not have the Retirement they think they will.

All my opinion of course.

Years ago my Father and I built a Mobile Home park, he told me one day that there was absolutely nothing wrong with living in a Mobile Home, but it was sad watching older people having to move back into one.
That was back in the 70’s with very high inflation and interest rates. Home Mortgages were insane then.

So what caused that then, and why are things so different now?

Bugger if I know the answer to any of this A6. If you’re the furthest from a financial expert, then I’m in a completely different world — or reality . All I really know is that I have little idea what tomorrow will bring, but I believe I can roll with most punches.

My financial wisdom is to focus on limiting the expense side of the balance sheet. Instead of chasing revenue I think freedom comes from reducing costs and limiting financial commitments. No debt, and limited living expenses means small demand for revenue/wealth.

I’ve never had a lot of luxury in life, and don’t really need much to be satisfied. I can definitely see myself moving into a mobile home community at some point in my future. I’ve had small periods living in various parks and I didn’t find them sad or difficult — quite the opposite really.

[a64pilot]

Originally Posted by Mike OReilly

My financial wisdom is to focus on limiting the expense side of the balance sheet. Instead of chasing revenue I think freedom comes from reducing costs and limiting financial commitments. No debt, and limited living expenses means small demand for revenue/wealth.

The older I get, the more I have a tendency to agree with you.
Happiness isn’t derived from having a lot of money, but from having what you need, and decreasing the amount you need is I think as viable if not more so than increasing the amount you have, in fact I have become to believe that Happiness is derived from finding a way to live on what you have. I’ve come to pity those my age and older that are still chasing the all mighty dollar.
In my opinion being debt free is key, it’s not easy to do for some and they don’t want to give up some of their luxuries to get there, but you can’t be “free” if you owe money.

My Wife’s Fathers Wife is my perfect example. She isn’t her Mother so I don’t know what to call her. Step Mother I guess?
Anyway this Woman has always lived above their means, always carrying significant debt, he is old and has had several Heart attacks and is therefore Retired and only has SS, but he inherited several old cars that are actually all original, Model A’s, T’s etc. His Uncle used to show them back in the 50’s and they are all original down to the wool interior. He was one of the original people that started NAPA.
Anyway she has pretty much demanded them all to be sold, in part so that she can buy a new three row seating SUV, for the two of them to make the down payment. Of course it’s financed, as is the house. I assume she has a 401K or two, but she is one of those that is smart enough to borrow money cause she can get it at less interest than her investments are earning.
Anyway she thinks she is going to Retire next year with all this debt.
It’s going to be a disaster, I can see it coming, but likely he will be dead before it gets ugly as he has way outlived expectations as it is.

If she had just decided years ago that an older used Honda was a fine automobile and met their needs etc. they would be sitting in great shape Retiring in South Alabama where the cost of living is as low as it can get. But she had to have those expensive purses and SUV, Yeti cups, Apple watches etc.

I keep thinking I’ll buy one just so it can stay in the Family, even though I have zero interest, it just seems a shame to see them go.