I’ll admit it—I’ve had more than one daydream where I’m sipping espresso in a sunny European café, or wading into crystal-clear waters somewhere in Central America, all while leaving behind the piles of mail, insurance paperwork, and that ever-increasing grocery bill here in the States. After all, isn’t retirement supposed to be our chance to finally choose adventure over alarm clocks?
Lately, I’ve been doing some serious thinking about the possibility of becoming an expatriate—yes, actually living abroad full-time in retirement. And let me tell you, it’s a juicy idea that comes with both tantalizing perks and some rather sobering realities. So if you’ve ever found yourself Googling “cheap countries to retire to” or eyeing your passport with curiosity, allow me to share what I’ve uncovered about the pros and cons of leaving the red, white, and blue behind—financially, emotionally, and practically. Check these out before making any plans or updating your passport.
Let’s start with the fun stuff—the pros, the glittery side of expat life that gets all the press. First off, and maybe most important for many of us, is the cost of living. In quite a few countries, your dollars stretch much farther than they do here in the U.S. I’m talking about renting a beachfront apartment in Mexico for the price of a leaky basement studio in Florida. Countries like Portugal, Ecuador, Panama, and Thailand regularly show up on those “Best Places to Retire Abroad” lists for a reason. You can often live a comfortable, even luxurious life, on a modest retirement income.
Medical care abroad is another surprising benefit. In places like Costa Rica or Malaysia, I’ve read story after story of retirees getting high-quality health care—yes, English-speaking doctors and modern facilities—for a fraction of what it costs here. Even dental care is laughably inexpensive compared to the U.S. One retiree I chatted with in a Facebook expat group said he flew to Portugal, had dental implants done, and still saved money compared to having the work done stateside. I mean, when a dental vacation becomes a thing, you know something’s up with our system. But I don’t have to explain that to someone living in the US, do I?
And then there’s the adventure. I’m not just talking about sightseeing, I mean the actual stimulation of learning a new language (or butchering it with flair), immersing yourself in a different culture, and discovering local markets that make our chain supermarkets seem downright boring. You start to see the world through a different lens, and there’s something beautiful and soul-expanding about that. Retirement isn’t the end of your story—it’s a chance to write a whole new chapter.
Now, that said, it’s not all rose petals and umbrella drinks. Let’s get into the cons, the nitty-gritty stuff that doesn’t always show up in those glossy retirement magazines.
One of the biggest sticking points for me, and for many others—is health insurance. Yes, health care abroad is cheaper, but unless you’re a dual citizen or qualify for national health care in your new country, you’re probably going to need international health insurance. Medicare, bless its bureaucratic heart, does not travel with you. So while you’re covered in the States, you’re on your own abroad. That means you’ll need to budget for private insurance, pay out of pocket, or make plans to return home for major treatments. And if you have chronic conditions, this can get tricky (and expensive) fast. No problem if you’re so healthy you don’t need to ever see a doctor, but most of us aren’t that lucky.
Then there’s the emotional side of leaving home. I know I’d miss my family. Sure, Zoom calls and WhatsApp help, but there’s nothing like hugging your grandkids or showing up for your cousin’s potluck. Becoming an expat means giving up the spontaneity of being close to your people. Holidays can get lonely, and if there’s an emergency, well—you’re a plane ride away. That’s a detail worth serious consideration.
Don’t even get me started on visas and residency requirements. Every country has its own rules, paperwork, and sometimes, painfully slow bureaucracy. Some countries require proof of a minimum monthly income or a hefty deposit into a local bank account. You might need to renew your visa regularly, which can be a hassle if you were hoping for a stress-free life. I once spent two hours trying to figure out the Portuguese residency process and needed a nap afterward. And I wasn’t even applying—just reading.
Now let’s talk about taxes. Here’s the kicker: just because you live abroad doesn’t mean Uncle Sam forgets about you. The U.S. is one of the only countries that taxes its citizens no matter where they live. Yes, you’ll still need to file a U.S. tax return each year, and depending on the country, you might also owe taxes there. There are tax treaties and exclusions to help you avoid double taxation, but it’s not exactly light reading. You may need to hire a tax pro familiar with expat laws, which adds to your costs. I don’t know about you, but I’d rather spend that money on cheese in France.
Another under-the-radar concern is estate planning. If you own property in another country or keep your financial accounts in a foreign bank, it complicates your estate. Different inheritance laws can surprise you, and if you want to leave assets to loved ones back home, it’s smart to consult an international estate planner—yes, that’s a real (and expensive) thing.
And then there’s just the plain old adjustment to daily life. Not speaking the language can make everything from going to the doctor to ordering lunch feel like a game of charades. Local laws may be different, and so are social customs. Want to build a deck or start a business? There could be rules you never even dreamed of. One retiree told me he had to get permission to paint the outside of his house a different color. I guess “freedom” is relative depending on the ZIP code—or lack thereof.
Still, I can’t shake the appeal. The idea of waking up somewhere new, with a slower pace and warmer weather, still calls to me. But I’ve decided that if I go for it, I’ll do it in stages. Maybe I’ll rent a place abroad for six months first and see how it fits. That way, I keep my U.S. ties but test the waters of a new lifestyle. And if I love it, then I can get serious about visa paperwork, healthcare logistics, and figuring out if I can live without my favorite brand of peanut butter.
In the end, becoming an expat in retirement is neither a guaranteed escape nor a financial miracle—it’s a major life decision that deserves careful planning, budgeting, and a healthy dose of realism. But for the right person, with the right preparation, it can be an incredible, enriching second act. And maybe even cheaper dental work to boot.
So if you’re like me and daydreaming about cobblestone streets, tropical sunsets, or bustling local markets, don’t dismiss it. Do your homework, talk to other expats, and try it on for size. Just don’t forget to come home now and then—especially if someone’s serving pie.
Sources for Further Reading:
- Social Security Administration: https://www.ssa.gov/international
- Medicare and Travel: https://www.medicare.gov
- U.S. State Department—Retirement Abroad: https://travel.state.gov/content/travel/en/international-travel/while-abroad/retirement-abroad.html
- IRS Tax Guide for U.S. Citizens Abroad: https://www.irs.gov/individuals/international-taxpayers
- International Living—Best Places to Retire: https://internationalliving.com
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Happy retirement planning!