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If you retire overseas, you can get your Social Security payments, but Medicare respects national boundaries that render it useless outside of the United States. In other words, retirees abroad aren't covered unless they return to American shores. Essentially, you have three options: buy private insurance, paying into a government-sponsored system in your country of residence, or do without. While you can opt out of the automatic Medicare enrollment to save that monthly premium deducted from your retirement benefits, you can only re-enter Medicare during an annual window. That said, health care options can vary widely overseas. Prescription drugs are frequently available over-the-counter and cost less. Before you retire Mexico or anywhere else, find out what kind of health care is available.
If you retire overseas and, say retire in Mexico, can you still collect Social Security? Yes. Social Security retirement benefits remain payable to expatriates who live any place except Cuba, Cambodia, North Korea, Vietnam, and certain parts of the former Soviet Union, and a few other countries. Almost 400,000 Social Security checks are mailed to beneficiaries living outside of the United States each month, and many more are directly deposited to expatriate recipients' U.S. bank accounts. Recipients living in any of a large number of countries can receive Social Security benefits from an international direct deposit service.
Should you retire overseas? The sentimental idea of an easier, simple yet romantic notions of expatriate life can exert a strong pull on the adventurous spirit. Some simply find new challenges in the adventure of discovering and flourishing in a new culture by retiring in Mexico, retiring in Belize, or any number of other popular overseas nations. Some "Type A" workers find the prospect of retiring a daunting proposition unless they relocate to an area far from home, and far away from their former work lives.
Why would Americans to leave their country not just to visit, but to retire overseas and live in a foreign land? Why retire to Mexico or retire to Costa Rica or any other point abroad? The reasons aren't much different than those that sent some of our ancestors from the Old Country in search of a better life. The cost of living is a big one. There's a perception that living in some foreign countries is cheaper than at home, but life abroad carries hidden costs. Iimmigration fees, getting--or losing--government benefits, taxes, work permits, and negotiating apparently labyrinthine foreign bureaucracy can be a daunting challenge.
If you retire overseas, you need not become a citizen or even get a permanent visa. A number of retirees live abroad as perpetual tourists, renewing tourist visas and stepping out of the country for as much as five minutes when those visas expire. However, most a more secure immigration status. Certain countries offer retirees substantial incentives. Belize, for instance, offers any American citizens over the age of 45 years who retire in Belize and who can demonstrate a monthly pension of more than $1,000 residency and tax-free importation of the retiree's household goods, car, boat, and airplane. Retire in Mexico and they will offer a similar deal, without regard to age, halving the monthly income requirement for those who own their own homes.
If you feel that retiring to Southern California or Florida just isn't exotic or appealing, you may want to retire oversease. More and more Americans spend their retirement years abroad and retire to Mexico or retire to Costa Rica among other locations. The U.S. State Department estimates that nearly four million Americans, not counting military and embassy personnel, are permanent residents in foreign countries.
|Jennifer Mathes, Ph.D.|