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

[Chotu]

Originally Posted by Mike OReilly

The houses I’ve bought here in Canada have cost me less than what the typical new pickup truck or SUV costs. Good houses. The best guide to inexpensive real (at least here in Canada) is to get away from of the big cities.

Do you find these houses are easily rented?

[valhalla360]

Originally Posted by Buzzman

In Oz, banks are much safer as they are guaranteed repayments. You forfeit on a home mortgage, you're still into the bank for the sum borrowed AND you lose the house. Bank wins, you lose.

That's how it works in most areas...except the "win/lose" editorial.

If you fail to make your payments, what happens, is the bank forecloses on the house.
- Bank sells the house.
- Proceeds of the sale are put against the outstanding balance plus any costs associated with the foreclosure.
- If there is money left over, the borrower gets the cash.
- If there is not enough money, the bank is left with an unsecured debt for the remaining amount.

It's usually not a "win" for the bank. Typically, if it goes to foreclosure, the house doesn't cover the loan & related expenses and people who don't make their mortgage payments usually don't have other cash handy to pay off the remainder of the loan.

The foreclosure sale is often lower because banks are not in business to hold and maintain houses, so it goes via auction. Plus a lot of foreclosed houses are trashed by the borrower...net result lower than market sales prices.

[valhalla360]

Originally Posted by Buzzman

This is why the lack of *real growth* in wages, pretty much across the board in devloped countries, is so harmful, as people's wages are being eroded by inflation, and so purchasing power is falling.

Wage growth in perpetuity is viable as it counters inflation.

"real growth" (ie: beyond inflation) is simply not practical over the long term. For short periods (ie: couple decades after WWII when employees were scarce and work was abundant) or when there is a big change in the economy (industrial revolution), wages can go up beyond the inflation rate (or in some cases the cost of goods drop while wages stay steady...take air tickets which aren't much different from the 1980s pre-deregulation).

But long term, it simply doesn't work to expect wage growth beyond inflation.

[GordMay]

... overall, the *whole* society is still way better off in terms of health, education, access to employment etc etc etc than the *whole society* was 200 years ago...

Yes, we’ve made significant societal progress over the past 200 years; but it mostly stopped about 40 - 50 years ago, when the “middle class” reached it’s economic apex. Since then, not so much.

[valhalla360]

Originally Posted by GordMay

Yes, we’ve made significant societal progress over the past 200 years; but it mostly stopped about 40 - 50 years ago, when the “middle class” reached it’s economic apex. Since then, not so much.

Has it?

40yr ago as a kid, if you heard someone had cancer, it was pretty much a death sentence. Heart surgery...that's a last ditch effort without a lot of hope. Compare that to today when many (not all) cancers are treatable. Heart surgery is routine.

The percentage of population with advance degrees has never been higher (I guess you could question the liberal indoctrination issue but by objective measures education has never been more attainable)

We are at 50yr low unemployment...basically the last time it was this low, a decent chunk of our employment age population had just been taken out by a world war.

Sure there are problems but if you remove money and look at actual lifestyle, it's never been better.

[Group9]

Originally Posted by Mike OReilly

I stopped paying attention to this thread some time ago, so I don’t even know what I was responding to, nor why you’re picking it up now.

I’ve never know a bank to NOT be a secure creditor. If you have examples of data that suggests otherwise, I’d be interested to see. Banks are usually near the front of the line to get their money back. And all loans of any size are hedged with insurance, with the premiums often paid for by the borrower. And when the sky really does fall, as in the 2008 implosion, the tax payer bails them out anyway.

So no … I stand by my comments. Banks take very little risk, but still reap most of the rewards.

If you haven't seen it, you've got to watch "The Big Short." Very entertaining, and informing.

[Mike OReilly]

Originally Posted by cj88

It's not that societies have never been wealthier, rather that a few within society have never been wealthier to the detriment of a large and still growing proportion of that society.

I agree with you in general. Although it’s clear our societies have been wealthier overall as well. It all depends on how you define wealth. If looked at from a population health perspective, we’ve advanced quite a bit (although a lot of current stats are troubling — life expectancy in the USA is now in decline, for example). From a material wealth perspective, almost everyone now has more stuff than 50 years ago.

But the point you are making is that despite the massive increase in wealth overall, we still have real poverty and significant disenfranchisement. How it can ever be considered right or fair that a tiny group can hold more wealth than the vast majority of people.

https://inequality.org/facts/global-inequality/

The world’s 10 richest billionaires, according to Forbes, own $745 billion in combined wealth, a sum greater than the total goods and services most nations produce on an annual basis. The globe is home to 2,208 billionaires, according to the 2018 Forbes ranking.

How much is enough?

Originally Posted by Chotu

Do you find these houses are easily rented?

Hmmmm, I don’t know. Not part of my calculus.

Originally Posted by Group9

If you haven't seen it, you've got to watch "The Big Short." Very entertaining, and informing.

Yup, read the book and watched the movie. It was both informative and horrifying.

[Buzzman]

Originally Posted by valhalla360

It's usually not a "win" for the bank. Typically, if it goes to foreclosure, the house doesn't cover the loan & related expenses and people who don't make their mortgage payments usually don't have other cash handy to pay off the remainder of the loan.

The foreclosure sale is often lower because banks are not in business to hold and maintain houses, so it goes via auction. Plus a lot of foreclosed houses are trashed by the borrower...net result lower than market sales prices.

Agree with all the above. Reality here in Oz is that you still owe the debt to the bank. They pursue payment aggressivley, even via garnishee orders on your earnings. Bank eventually gets paid. In full.

They've even been known to garnishee welfare payments....send the court bailiffs round to repossess your portable assets - car, boat, TV, furniture.

It's not like the States where some borrowers can walk away from the loan and leave the debt and the problem to the bank.

Non-recourse mortgages are very rare in Oz.

[valhalla360]

Originally Posted by Mike OReilly

How much is enough?

That's up to the individual. If they want to keep working and not spend it...more power to them if they want to earn more.

The better question is how much is too much?

Some think that they deserve what others have earned and try to justify taking it by claiming they have too much.

[valhalla360]

Originally Posted by Buzzman

Agree with all the above. Reality here in Oz is that you still owe the debt to the bank. They pursue payment aggressivley, even via garnishee orders on your earnings. Bank eventually gets paid. In full.

They've even been known to garnishee welfare payments....send the court bailiffs round to repossess your portable assets - car, boat, TV, furniture.

It's not like the States where some borrowers can walk away from the loan and leave the debt and the problem to the bank.

Non-recourse mortgages are very rare in Oz.

Sounds like Aussies have it right. I'd have to see a clear definition of "welfare" before commenting on that but if you can't pay your debt, you don't need a boat or big screen 4k TV.

A big part of the 2008 debacle was we rewarded those who defaulted on mortgages by letting them walk away with minimal penalty when many could have made their payments. That probably doubled the scale of the housing problem as a mass of foreclosed houses pushed the general house values down which spurred others to default by choice.

[ArmyDaveNY]

Originally Posted by valhalla360

Sounds like Aussies have it right. I'd have to see a clear definition of "welfare" before commenting on that but if you can't pay your debt, you don't need a boat or big screen 4k TV.

A big part of the 2008 debacle was we rewarded those who defaulted on mortgages by letting them walk away with minimal penalty when many could have made their payments. That probably doubled the scale of the housing problem as a mass of foreclosed houses pushed the general house values down which spurred others to default by choice.

The waste in that program was amazing. I was involved with mortgages and investments, and eventually mortgage modifications. The fraud was widespread. Worse, in many and perhaps the majority of modifications, the person still lost their home. In addition to the problem of affordability, there was the problem of taxes. The modifications of the mortgages did not reduce the property taxes here in the U.S.


On a different note, our "poor" today are far better off than the poor a century ago. This is true to the extent that the definition of poor has even changed to where the "poor" today would be considered better off by the poor of centuries past.



One of the biggest problems, and one of the least discussed, is the role of the central banks and their devaluation of our money. Here in the U.S, our central bank, the Federal Reserve, has a publicly stated goal of 2% inflation!!! The reality is that the real inflation rate is higher than the official rate.


It's pretty hard to have real income growth when you pay is constantly devalued.

[seadago]

Going back to the original topic...
Whomever in Yahoo picked Uruguay (3rd place) as a likely destination to live on US$ 200 k, either has never been to the place, or was high on the weedy stuff legally and readily available there. Or both.
I can't begin to list all the reasons why, but will give it a try, just in case someone in the forum may be tempted to think about it.
1) General cost of living in major population centres (e.g Montevideo, Colonia, Maldonado) is on par and above to equivalent areas in W Europe (e.g. UK, France), with accommodation, basic services, entertainment, and food categories as the most expensive.
2) State-provided health services, albeit good for regional standards in terms of quality, are not comparable to those offered in W Europe. Additionally, they are contributory, so private medical insurance is all but a must for foreigners, and prices are, again, on par with US.
3) Security is an issue for everyone. Street crime is ubiquitous and violent in the cities.
4) Official inflation figures hover about 8%. As official estimates are massaged, this means real inflation rate is closer to 20% p.a. Go figure what return you need to get those US$ 200K to produce, to just break even.
5) Heaviest tax burden in South America, as a % of personal income.
6) If a cruiser hoping live aboard, and to at least spend significant time on the hook, there are no protected anchorages on the Atlantic or River Plate coasts. Only options are the marinas in Punta del Este, Piriapolis, Puerto del Buceo (Montevideo), and Colonia, and mooring fees in those places are on par with the most expensive Med areas. There are others further north up the Uruguay river.

So... no, and certainly not on 200K!

[john61ct]

Same can be said in most countries suggested, **if** you "need" a first-world standard of living.

However if you have the ability to enjoy life living simply, learn the language, stay away from places more dangerous than large US cities, and learn to live (to some extent) as the locals do.

Obviously keep your nest egg in USD, or ideally a mix of selected relatively stable currencies.

[Buzzman]

Originally Posted by seadago

6) If a cruiser hoping live aboard, and to at least spend significant time on the hook, there are no protected anchorages on the Atlantic or River Plate coasts. Only options are the marinas in Punta del Este, Piriapolis, Puerto del Buceo (Montevideo), and Colonia, and mooring fees in those places are on par with the most expensive Med areas. There are others further north up the Uruguay river.

And don't forget Riachuelo, Playa Verde, Boca del Rosario, Boca del Cufre and Santiago Vasquez, where Yacht Club Uruguayo has premises, jetty and moorings.
The latter mast height may be an issue for bigger boats, and depth may be an issue for some of the others, but all have yachts moored at them.

[seadago]

Originally Posted by Buzzman

And don't forget Riachuelo, Playa Verde, Boca del Rosario, Boca del Cufre and Santiago Vasquez, where Yacht Club Uruguayo has premises, jetty and moorings.
The latter mast height may be an issue for bigger boats, and depth may be an issue for some of the others, but all have yachts moored at them.

Hi Buzzman
You are right. One can anchor there. As far as I remember, facilities are for dinghies, and cats. I would use the Rosario or Cufré as a weather refuge or overnight stop over, but I would not call them "anchorages". In either case, might as well, aim for Playa Verde, as you mention, rather than attempt entry through the narrow river mouths.

Irrespective, the topic of the thread was about places you can retire on 200 k and feel rich. In the context of all the possible places that could be selected, I'm afraid Uruguay would be a poor choice.