Increasing numbers of American retirees are moving to Central or South America to live out their years. The main reason is financial -- huge numbers of seniors are broke.
A study by the National Bureau of Economic Research found not so long ago that almost half of Americans die nearly broke. Of the general population, 46% of retirees die with savings of $10,000 or less. But that number climbs to 57% among retirees who are single.And so: "Retirees flock to Latin America to live an upper-class lifestyle on $1,500 a month"
Now when we take other assets, like homes, into account, the picture gets a bit less bleak. Still, 57% of single-adult households and 50% of widowed households had no housing equity to show for when they died.
The problem is that dying nearly broke isn't just a matter of denying one's beneficiaries an inheritance. Rather, it points to a frightening degree of financial vulnerability during retirement. If seniors are passing without much in the way of assets, it means that in the years leading up to their death, they're ill equipped to handle a major unexpected expense, such as a significant medical bill. In fact, in that same GoBankingRates survey, only 37% of seniors 65 and older claimed to have $1,000 or more in the bank.
CUENCA, ECUADOR - To casual visitors, this colonial town in southern Ecuador looks like it was torn from the pages of history. With its cobbled streets, soaring cathedrals and bustling markets, it exudes a lazy, old world charm.An American couple in the city, Susan and Michael Herron, told the paper,
But Cuenca is also on the cutting edge of a very modern trend: providing a safe haven for U.S. retirees who have found themselves unwilling — or unable — to live out their golden years at home.
The growing wave of ex-pat seniors is not only upending notions about retirement in the hemisphere but reshaping the face of communities throughout the Americas. And the trend is expected to grow as waves of baby boomers exit the workforce ill-prepared for retirement.
There’s no accurate way to measure the phenomenon, but the Social Security Administration was sending payments to 380,000 retired U.S. workers living abroad in 2014 — up 50 percent from a decade ago.
In the Americas, records show that seniors are flocking to Canada, Mexico, Colombia, the Dominican Republic and Ecuador.
They had previously “retired” in Central Florida, Georgia, Alaska, South Carolina and Panama before finally settling on Ecuador — because it was beautiful and cheap.These days even HGTV has shows about how to buy a home down south. Costa Rica has long been a popular place to retire for Americans with a good climate, low prices and the highest percentage of US-trained doctors in the Western Hemisphere outside the United States.
“We could have survived [financially] in the United States if we had moved to a more rural area,” said Susan, 71, a semi-retired property manager. “But we wanted to take this chance while we were still healthy enough to be able to do it.”
In Cuenca, a city of about 350,000 people, they’ve found robust public transportation, an extensive museum network, solid healthcare and markets bursting with fresh fruits and produce. It’s a place where their two-bedroom, two-and-a-half bath apartment costs less than $400 a month. They’ve found that for about $1,500 a month, they can live a solidly upper-class lifestyle, dining out frequently and traveling.
“In the United States, we couldn’t afford to go anywhere,” Susan explained. “We were having to stay home.”
In the military-related forums I visit, there are often discussions about retiring in Latin America or a handful of other countries, mainly Asian (including Vietnam!). Military retirees have typically lived in other countries already by the time they retire and have learned to adapt to foreign cultures. I admit the thought has crossed my mind, too, although I still have a number of years to go before I retire from my post-military career. But the trend will continue.
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