What is the Cost to Retire Overseas?
I often get letters from people asking how much money they need to begin their own personal retirement travel adventure and what does it cost to retire overseas. They will throw out a financial figure (usually between USD $2,500 and $6,000/mo.) and ask, “is that enough?” Inevitably my answer is a derivative of, “I have known people who are living their travel adventures on a fraction of that and are very content. I also know travelers who have access to funds many times the multiple of that number and are unsatisfied. It all comes down to your needs, wants, and expectations.”
I know that seems like a flippant answer, but it is the most honest one I can give. The question is like asking, how long is a piece of string? There just isn’t enough information there to offer an intelligent response. I know these people are in search of confirmation that they are ready or on the right track to retire and move overseas, but ultimately, the answer is as much personal as it is economic.
We have all seen the studies on human happiness that say, once our minimum needs for basics such as; food, shelter, healthcare, etc. are met, considerable increases in money result only in minimal increases in satisfaction. I have seen that to be true of adventurous retirees looking to live a traveling or nomadic lifestyle as well. That means you need to find that elusive point in time where there is enough money to meet your retirement adventure needs, but not go so needlessly beyond the point where you are unnecessarily delaying getting started. Trust me, no matter how prepared you are, making the jump will still be a little scary.
I am not a financial professional. Quite the contrary, so take all of this with a huge grain of salt and proceed at your own risk. All I have to go on is my conversations with other expats and travelers, and what I have encountered after six plus years. From what I have witnessed and experienced, if you figure things out for yourself, are flexible and willing to deal with a degree of uncertainty; not only will you require less, your experiences may be more genuine and educational. If you want someone else to figure things out for you, you need rigidity in your schedule and aren’t a believer in serendipity; your travels will require more money and they are also apt to be more bland and homogenized.
Financial advisors are conservative by nature (not to mention that they may have a personal stake advising you) and will often give you large, scary numbers that may be difficult to achieve before you retire. You may be scared into thinking you will be on bread and water rations forever if you don’t follow their advice. On the other hand, life coaches and spiritual gurus may tell you to throw caution to the wind and just go for it. As with most things, the truth usually lies somewhere in the middle.
We all desire security, but that is one thing that does not exist. As Hellen Keller said of it, “Avoiding danger is no safer in the long run than outright exposure.” Since security is ultimately an illusion, as we contemplate retiring we have to answer for ourselves; do we need more freedom and flexibility now, or do we need to keep saving and delaying, hoping for more security. It is a balancing act. One thing for certain, the longer we delay, even if money is increasing, our limited supply of time is dwindling. Time or money, how you use it is up to you.
The most important thing for me has been right-sizing, my finances and my lifestyle as well
The most important thing for me has been right-sizing, my finances and my lifestyle as well. My lifestyle would be overwhelmed by having tons of superfluous possessions to transport and maintain. Not only is it expensive, but it is also time-consuming and a huge distraction if you want to be traveling or just enjoying life instead of managing stuff. I am not suggesting that I live like an ascetic, quite the contrary, but I try to keep my possessions in check and only allow those things that have great utility or bring me great pleasure.
More for me money might mean flying first class instead of coach from adventure to adventure, but upon arrival, I would still, for the most part, travel “close to the bone” because I like the adventures better there. Sure, I do occasionally like to spice things up with some over the top luxury but, to me, the real benefits and satisfaction of travel come from seeing the world like locals, not isolated in an artificial bubble created for my comfort.
What I am trying to say is, what works for me, wouldn’t be a perfect fit for you; financially or otherwise. We all have different desires, comfort levels, and fears. What I can say with certainty is that choosing to live my retirement with bigger boundaries, sometimes at the limits of my comfort zones, has brought me more joy and fulfillment than anything prior. Everyone is different and, of course, this life isn’t for everyone but, being open to possibilities has the potential to open up incredible new worlds, some even better than you can imagine.