Three million members of the baby boomer generation retired in the early stages of the COVID-19 pandemic. But not all who have retired left the workforce voluntarily, and not all were in a strong financial position. When determining where they'll live during the next chapter of their lives, affordable housing and access to health care will be priorities for this cohort.
In its 2022 Global Retirement Index, International Living (IL), a news source that provides guidance for those pursuing retirement abroad, analyzed potential destinations by looking at information across 10 significant categories — these include ease of obtaining permanent residence, housing and medications — to rank the best places to retire abroad.
Where can you retire affordably?
As record-high inflation and rising health care costs threaten to further increase the cost of living, the prospect of retiring comfortably may seem unattainable. Though many older workers have left the workforce since the onset of the pandemic, a previous Nationwide survey noted that 30% of its respondents who are employees ages 65 and older were delaying or giving up on retirement altogether due to the health crisis.
But their plans could change if they considered relocating outside of the U.S. — in IL's yearly Index, the company looks at destinations where they say a couple could retire comfortably and safely, "on as little as $2,000 a month." And with a median income of $27,398 for those 65 and older and close to 10% of that population living below the poverty line (according to the 2020 Profile of Older Americans from the U.S. Department of Health and Human Services’ Administration for Community Living, the most recent available), in retirement, every dollar will count.
If you're ready consider retirement abroad, you might want to look into one of International Living's top 10 best-ranked retirement destinations:
- Costa Rica
South and Central America are well represented in the index’s top 10 with six countries from that region, and Central America particularly stands out with the two best-ranked destinations on the list — Panama and Costa Rica. Panama, in first place for the 11th time, is a country that survey respondents say has many of the features retirees should look for: These include agreeable climate, affordable public transit and reliable WiFi and cell service. On top of that, residents can access the Caribbean coast or catch a 3-hour flight to Miami. Meanwhile, Costa Rica was cited especially for its affordability, healthy lifestyle and friendly community.
How do you choose a retirement destination?
There are many wonderful places to live, but not all of them will have the amenities retirees are looking for. When considering which destination is right for you, you'll want to take the following categories (adapted from IL's retirement destination index) into consideration:
- Visas and residence. Ease of obtaining permanent residence and how you'll be taxed on income earned inside and outside of the country.
- Housing. Ease of buying or renting affordable housing and how property taxes are assessed.
- Cost of living. Affordability of all necessities and basic entertainment.
- Health care. Cost and availability of common procedures and medications.
- Governance. A governmental system providing safety, stability and personal freedom, as well as reliable banking services.
- Social life. Availability of familiar amenities, activities and entertainment, as well as ease of making social connections.
- Infrastructure. Access to reliable internet, electricity and clean water, as well as the quality of roads and public transportation.
- Weather. A livable climate, factoring in rainfall, temperature and humidity, among other conditions.
- Benefits. Free or discounted services for retirees, which could include airfare, food, electricity and more.
- Opportunity. Ability to work remotely or pursue a business project to supplement your income.
Methodology: International Living's 2022 Annual Global Retirement Index is based on a survey of its editors, foreign correspondents and in-country contributors, examining 25 destinations beyond the U.S. and Canada. Data collection occurred between August 2020 and August 2021.