Over five million Americans live overseas. This number includes service members, government workers, businesspeople, students, humanitarian workers, and increasingly—retirees. The United States is one of the most expensive places to live in the world. With inflation and health care costs through the roof, many people are finding they can stretch their retirement savings further by living abroad. We’ve checked into sources like the U.S. State Department, Global Citizen Solutions, Immigrant Invest, Condé Nest Traveler, and others to find out where Americans are retiring in droves, and why.

24/7 Wall St. Insights

• Retiring overseas is no longer just for the rich. It’s achievable, and maybe even economically necessary, for middle-class retirees.
• Most of the most popular retirement countries have a high standard of living, excellent medical care, and offer a stimulating cultural experience.
• The downsides to retiring overseas are learning a new language, the expense of visiting family, and political and economic instability.
• To help you invest profitably for retirement, 24/7 Wall St. would like to send you a free report: 2 Dividend Legends to Hold Forever.

Is Overseas Retirement Only for Rich People?

Retiring outside the United States is not just an option for rich people. In fact, in many cases, it is a way for middle-class people to enjoy a nicer retirement than they could afford if they stayed in the U.S.

Let’s imagine for example a couple retiring at 65 with a nest egg of $500,000. The average home price in the U.S. is now over $400,000, so a middle-class couple that otherwise has little savings for retirement might find most of this money in their home equity. Experts say you can withdraw 4% of your nest egg a year to stretch it for 30 years. This would give the couple $20,000 a year, not including Social Security. While this is below the poverty line in the United States, it can provide a reasonably comfortable life in Mexico where the cost of living is nearly 50% lower and health care 60% lower than in the United States.

What Should You Consider Before Retiring Abroad?

Before jumping on the living abroad bandwagon, here are some areas to think about:

• How often do you want to visit your friends and family back home?
• Are you willing to learn a foreign language?
• What kind of climate agrees with you best?
• What lifestyle changes would you be willing to make?
• Do you have an adventurous nature and like to try new things, or do you prefer what is familiar and comforting?
• Do you have health conditions that will limit where you can live and what kinds of medical facilities need to be nearby?
• Are you willing to divest yourself of your possessions in the States and live a more minimalist lifestyle abroad, if your income requires it?
• Will you be able to receive your Social Security payments in the country you have chosen?

Most Popular Overseas Retirement Destinations

The most popular overseas retirement destinations are also some of the most popular vacation spots. These are some of the world’s most developed economies, offering a standard of living comparable to that in the United States. Some Americans choose to retire there because they have previously vacationed there or have family ties there. Healthcare costs are often less expensive than in the U.S., and when the dollar is strong many other goods and services can be affordable. However, currency fluctuations in such strong economies can erode the value of the dollar and make your retirement more challenging.

All of this speaks to the need to invest wisely in the years leading up to your move. To help you do this, 24/7 Wall St. would like to send you a free report: 2 Dividend Legends to Hold Forever. And now, without further ado, next are the 10 countries that attract the largest number of American retirees.

10. Spain

• U.S. Retirees: 57,112
• Pros: There are a lot of reasons to retire in Spain: it has an affordable cost of living, a beautiful Mediterranean climate, a relaxed culture, and tasty and healthy cuisine. Spain places few obstacles in the way of foreigners trying to buy property.
• Cons: You’ll need to put time and effort into learning the language. The country has more economic struggles than some of the stronger economies of Europe. If you’re someone who wants things to happen on time and efficiently, you’ll have to adjust to a more relaxed and free-flowing lifestyle.

9. Japan

• U.S. Retirees: 58,340
• Pros: Japan is safe, clean, and friendly. It has a high standard of living and technologically advanced healthcare, which is available to all citizens.
• Cons: Retiring in Japan requires going through a 10-year process to earn citizenship, learning Japanese, and having a minimum income of $32,200 a year.

8. France

• U.S. Retirees: 61,668
• Pros: France is a technologically advanced, modern country that retains Old World charm and history. Its culture is often associated with prestige, luxury, and romance. Housing can be quite affordable away from the beaten path.
• Cons: The language can be difficult to learn to perfection. Citizens in large tourist areas like Paris can become weary of interaction with foreigners.

7. South Korea

• U.S. Retirees: 68,050
• Pros: South Koreans generally love Americans and interact with them with curiosity, appreciation, and respect. In Asian cultures, aged people are accorded special honor and respect. About 40,000 American troops are stationed in the country, which can enhance your sense of security living there.
• Cons: The Korean peninsula is one of the most dangerous flashpoints for conflict in the world, with a nuclear-armed North Korea poised to attack the South without warning. The Korean language is one of the most challenging languages for Americans to learn.

6. Israel

• U.S. Retirees: 76,794
• Pros: Israel has an idyllic Mediterranean climate, a first-world standard of living, many English-speaking people, and a special cultural and historical significance for Jewish Americans.
• Cons: The region is prone to terrorism and war and the government is not able to completely protect the security of residents. The Hebrew language is difficult to learn. 

5. Australia

• U.S. Retirees: 116,620
• Pros: Australia has over 10,000 beaches, more than any other country in the world, and 85% of the population lives within 30 miles of the coast. The culture is friendly and laid-back. Americans generally don’t have too much difficulty understanding the Australian accent and find it pleasing to the ear.
• Cons: The country is geographically distant, so it is expensive and time-consuming to fly back and forth. Australia is also infamous for its dangerous snakes, insects, and marine life. The climate can also be extreme, with flooding, droughts, sandstorms, and wildfires.

4. Germany

• U.S. Retirees: 152,639
• Pros: Germany is rich in culture and history, is technologically advanced, and has a strong economy and a comprehensive social safety net. It is centrally located and a member of the European Union, so residents can easily visit neighboring countries using the region’s high-speed rail network.
• Cons: The cost of living is quite high. Though many people speak English they can be shy about doing so. It will be necessary to steadily learn and improve in the German language. Americans may find the high taxes, rules, and regulations of Germany oppressive. German people can be more shy and reserved than some Americans, so making friendships may be a slow and gradual process.

3. United Kingdom

• U.S. Retirees: 170,771
• Pros: You won’t have to learn a foreign language, though you may find some regional accents challenging to understand. The U.K. has a strong economy. Major cities are vibrant centers of international culture. The country is steeped in history and culture.
• Cons: The social class system can present unspoken barriers to a foreigner trying to form friendships with local people. British politics can be chaotic and include abrupt changes such as Brexit that affect the economy for better or worse. The weather can be abysmal and depressing. Budget for an occasional Mediterranean vacation!

2. Canada

• U.S. Retirees: 273,226
• Pros: Canadian culture is similar to that of the United States. 90% of Canadians live within 100 miles of the U.S. border, so it can be an easy drive or short flight to visit folks back in the States. Canadian people are unfailingly courteous and welcoming, so you’re likely to feel at home.
• Cons: Citizens of the U.S. can underestimate the real cultural differences they have with Canadians and can come across as arrogant and insensitive. Some Americans will chafe at the taxation and regulations in Canada that support a more robust social safety net.

1. Mexico

• U.S. Retirees: 799,248
• Pros: Mexico borders the U.S. and is easily accessible by car or plane. Spanish is one of the easier languages for English speakers to learn. The cost of living is about 50% that of the U.S. There are a variety of climate zones in the country to choose from, including tropical, temperate, and arid.
• Cons: Poverty and crime are serious problems, including drug cartel violence. The country is subject to natural disasters like earthquakes and hurricanes. Changing U.S. immigration policies can contribute to refugee problems in border areas.

More Affordable Retirement Destinations

The countries that have attracted the most American retirees up until now are those with high standards of living and strong economies, as well as places like Mexico where a large number of Americans have family connections. Global Residence Index suggests the following countries that are a little more off the beaten path but might be more affordable for retirees on a limited budget:

• Costa Rica: a peaceful, scenic country known as the “Switzerland of Central America.”
• Belize: the only English-speaking country in Central America. You’ll find tropical rainforests, Mayan ruins, and spectacular diving.
• Thailand: a popular destination for medical tourism with a warm climate, rich cultural heritage, and great beaches.
• Philippines: this former U.S. colony has a large number of English speakers and is a popular retirement destination for retired military.

Perhaps most of all, people considering retiring abroad should remember they are not selecting a place to vacation, but a new home, perhaps for the rest of their lives. Quality of life, climate, culture, and cost of living will all be important considerations to help make this time of your life truly your golden years.

 

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