A FEW FINANCIAL BASICS OF RETIRING ABROAD
So, you want to settle somewhere else during your retirement age? Sure, a fresh and and unique view every time you open your window would be nice, as well as indulging yourself to whole new culture sounds exciting, but before all these niceties, a more important factor to keep in mind would be how to handle your available funds because although you have your pension, a few bad decisions in choosing your retirement place may put it to waste or worse, may be insufficient in providing you with your daily needs.
If you really want to push through with your overseas retirement, one of the considerations that might be useful for you to recognize is your health care expenses. Remember, medical care does not extend outside the US--you’ll have to buy your own insurance to cover your medical costs or the required fee in case you need to go back to your country for further treatment. A more difficult situation you could get stuck into is having a recurring illness, which means higher fees that could wipe out every bit of your savings.
A wiser move for you regarding this is to choose a country that offers universal healthcare, so better start on your research now and see what countries provide these national health plans.
Also, if you think staying in a foreign country by the time you’re 65 and above would mean an exemption from your taxes, then think again. As long as you are a US citizen you will still be required to pay your taxes and file your tax return as being unable to do so would be subject to penalties. On top of this, Americans living abroad are required to report their funds in foreign banks account if it ranges above $10,000.
Another thing that may leave you penniless during your retirement years is your travel costs. Obviously, retirees in other countries would have family member left behind, which they may want to visit occasionally. However, air fare is not exactly what you would call as cheap--you can spend as much as $4,000 for just a one-way journey. While travel-rewards can offset some of your expenses, your remaining balance still won’t be enough if you wish to go from place to place several times a year. So if you think you’re going to need to travel a lot, better start thinking twice on your plan to retire abroad.
If you want your overseas retirement to be free of conflicts, avoid simply plunging in to whatever country looks pleasant to you. You need to familiarize yourself and gather information about your chosen location first, and of course, have a long-term perspective before you finalize your decision.
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