Retiring Abroad and Social Security

[MULTIZ321]

Things to Consider Before Retiring Abroad
By Kathleen Nemetz, CFP, CDFA/ Advisor Insights/ Investopedia/ investopedia.com

"With many Americans woefully underfunded for retirement, people are exploring retirement abroad as a way to stretch their retirement income. The Social Security Administration reports a 73% jump in the number of retired workers receiving their benefits overseas since 2000.

The cost advantages to an overseas retirement are usually the draw. Couples living in less expensive nations can find housing at a fraction of the cost in the U.S.. In some countries, medical coverage costs less than using Medicare.

Talking to actual expats is the best way of verifying the cost savings you can expect. Also, cost of living websites like www.numbeo.com collect and report typical costs for a variety of living expenses by city and country. For example, here is a link comparing typical costs in Chile to those in the U.S.

How to Receive Social Security Benefits Abroad
Receiving a Social Security benefit while living outside the U.S. can be facilitated in certain countries with an electronic transfer. A list of countries allowing the Social Security Administration to make automated payments to banks within their borders can be found at www.socialsecurity.gov by searching for “IDD countries."

Retirees living in other countries can ask for an exemption to receive a paper check instead, as the U.S. Treasury otherwise imposes the requirement of electronic transfers. (For related reading, see: 6 Countries Where You Can Live off of Social Security.)...."

Richard

 

[isisdave]

While you CAN have your retirement SS delivered this way, most expats either have it put into their US account and either take it out of the ATM overseas, or write a check on the US bank from time to time and deposit it to their overseas bank.

Note that overseas SS Disability payments have different rules.

 

[moonstone]

A neighbour of ours in Belize only qualified for less than US$800/mo. SS and he just couldn't afford to stay in the USA when he retired. In (Corozal)Belize he has a nice 1 bedroom furnished apartment 1 block from the bay, eats out often and saves enough to fly up to Seattle once or twice a year to visit his aging mom. He lives very comfortably compared to how he would need to live in the US. He does as isisdave posted, and has his SS deposited into his US Bank of America account and then withdraws cash as he needs it from the B of A in Corozal.

I looked at the website (numbeo) in the article and many of the prices are off (most high, some too low) for food, at least for what we were buying in Corozal.


~Diane

 

[VacationForever]

A neighbour of ours in Belize only qualified for less than US$800/mo. SS and he just couldn't afford to stay in the USA when he retired. In (Corozal)Belize he has a nice 1 bedroom furnished apartment 1 block from the bay, eats out often and saves enough to fly up to Seattle once or twice a year to visit his aging mom. He lives very comfortably compared to how he would need to live in the US. He does as isisdave posted, and has his SS deposited into his US Bank of America account and then withdraws cash as he needs it from the B of A in Corozal.

I looked at the website (numbeo) in the article and many of the prices are off (most high, some too low) for food, at least for what we were buying in Corozal.


~Diane

I am assuming he has other income, abate small, besides SS.

 

[moonstone]

I am assuming he has other income, abate small, besides SS.

Nope, he says he lost his house in his divorce & never had a steady job, let alone with a pension plan.

 

[m4travels]

My husband has had his SS deposited directly to our Mexican bank account for the past year. It's been working great for us. We were doing really well when the exchange was +$20 pesos to the dollar. Last month was approximately $18.60/dollar. This covers our rent and about one-half of our living expenses for the month. It arrives on the third day of each month and I transfer out the required amount for rent the next day. The next day we're off to Costco!

 

[VacationForever]

Nope, he says he lost his house in his divorce & never had a steady job, let alone with a pension plan.

Cannot imagine $800 per month being enough for just food even in Belize... I should be so ashame of myself...food bill for the 2 of us now that we are retired (breakfast in, lunch out everyday, dinner out once to twice a week, plus groceries) run us at about 3K per month... this has been severely scaled back from when we were working.

 

[MuranoJo]

...food bill for the 2 of us now that we are retired (breakfast in, lunch out everyday, dinner out once to twice a week, plus groceries) run us at about 3K per month... this has been severely scaled back from when we were working.

I thought DH and I were spending too much, and we do most of our meals at home. That's a pretty hefty grocery/dining bill, for sure! Hate to ask what it was before you scaled back, LOL.
But, ya know, each to their own--to those who love good food and dining out, and I say do what you love--especially when you're retired. Whoop it up if you can afford it.

 

[VacationForever]

I thought DH and I were spending too much, and we do most of our meals at home. That's a pretty hefty grocery/dining bill, for sure! Hate to ask what it was before you scaled back, LOL.
But, ya know, each to their own--to those who love good food and dining out, and I say do what you love--especially when you're retired. Whoop it up if you can afford it.

Food + food related groceries were running about 5K per month. We are actually quite proud of ourselves by cutting down to 3K a month now.

 

[Dollie]

There is no reference to medical coverage. Medicare does not cover you outside the US. Medical coverage could be a large additional cost.

 

[moonstone]

Cannot imagine $800 per month being enough for just food even in Belize... I should be so ashame of myself...food bill for the 2 of us now that we are retired (breakfast in, lunch out everyday, dinner out once to twice a week, plus groceries) run us at about 3K per month... this has been severely scaled back from when we were working.

Yikes! 3K / month!!
We spend the winters in Corozal -not the touristy expensive (ie;Ambergris Caye) area. DH & I kept track of all our spending the first year (Jan-Mar.2016) we were there so we could make sure we could afford it for future years. We spent on average about $60US per week on food, that included any quick trips out for a box of milk or loaf of bread. We ate 95% of our meals at the apartment & by looking at us you'd know we didn't starve! We buy local fruit & vegies (8 large bananas for $0.50US, a huge pineapple for $1.00US) and eat meat (chicken breasts, pork chops...) & 2 veg for dinner every night. Eggs were about $1.75US for a bag (yes a bag!) of 30 huge ones. Meat prices were slightly less than what I pay in Canada. (At home we average about $100.Cndn/week for all our groceries & eat out 2-3 times / month.) When we did eat dinner out at our favorite place in Corozal, it cost us about $20.00 BZ or $10.US depending on how many beer DH had.

Rent is very reasonable provided you don't want to stay in accommodations similar to the Hilton. We paid about $200US more a month in rent than our friend because we rent a nice apartment in a hotel facing the bay, rather than in the back of a locals house a couple of blocks from the water. Water, electricity, cable TV, butane (for cooking & BBQ) were a fraction of what we pay at home.

So it very possible to live comfortably on a small amount if you need/want to.


~Diane

 

[moonstone]

There is no reference to medical coverage. Medicare does not cover you outside the US. Medical coverage could be a large additional cost.

Or it could be a very small cost. Nearly all the American Expats we know in Belize have emergency medivac coverage and pay for any treatments & tests out of pocket. Last winter DH developed a bad ear infection. After 2 visits to the local Dr., a swab test of some sort, 10 days of antibiotics and 5 days of pain meds, our total cost was less than $20.US

~Diane

 

[am1]

All these articles underestimate the costs involved. Once the person arrives then reality sets in. A lot of things are cheaper and over all may be cheaper then where you are coming from but it is still expensive.