Where would you retire and why??



Where would you retire and why??
"Can we read it on the Smoking Gun? "
cairns, northern qld- if i was 'rich' and could sustain a retirement on $20k + pa
or a cute small town in thailand somewhere. budget retirement![]()



I am looking at retiring in Mexico. I live in Texas, so I would not be far from family. My boyfriend speaks spanish, and frankly is a mexican, so there's some extra help there. He has family in Mexico. I plan to learn spanish myself though. The dollar to peso rate would make for some great living. However, there are still other factors to consider, such as healthcare, etc.
I am still looking at different places.





top two possibilities on my list are Malta and Belize, followed by Andorra. Actually Andorra is far and away my top pick if I can resolve that I will never come back to the USA once I leave (because odds are the FBI/IRS would grab me stepping off the airplane). Belize is the best 'legal' tax deal ( see ) , but there is always the concern that political problems in neighboring countries might spill over. Malta is an all-around safe pick.



Bahamas with my own marina and boat.
Isocrates: “Democracy destroys itself because it abuses its right to freedom and equality. Because it teaches its citizens to consider audacity as a right, lawlessness as a freedom, abrasive speech as equality, and anarchy as progress.”



I thought about Belize, Melonie. But my mother grew up in South American and warned me that going that far down south could get dangerous for Americans.





^^^ agreed, even though Belize has deep British roots, Mexico, Costa Rica and a host of other potential anglo-hating neighbors aren't very far away. The only way Belize could work is if you have a sea-worthy boat available to 'take a powder' in a hurry if things were to turn dicey.
The main attraction of Belize is of course its 100% legal and above board tax-free package for 'relocated retirees', the ability of 'relocated retirees' to obtain a Belize passport, and the ability of 'relocated retirees' to own property (with title insurance) in Belize. This is a huge contrast to Mexico, where ex-pat's don't ever truly get the right to do more than lease property they 'buy' in Mexico.
Plus, I have grave suspicions that the most recent Mexican election plus America's commitment to build the border wall and boot out Mexican illegals (or at least take away their under their under the table paychecks and welfare / medicaid benefits) are going to seriously amplify already existing Gringo resentments in Mexico. After all, 'remittances' to Mexico from Mexicans working in America (legally or otherwise) is Mexico's #1 source of hard currency earnings !
As to Thailand, while that country looks good 'on paper' as well, the rapidly rising tide of anti-American terrorist activity in Thailand is making the risks of trying to live there too great.
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Last edited by Melonie; 10-18-2006 at 09:27 AM.
Mexico. Not all parts are dangerous & "gringo-hating."
I'd keep a place in Montana- I love my new home state.





Oh, absolutely true (thinking Cancun / Cozumel). However these 'gringo-friendly' areas are also rather expensive re cost of living, and also don't allow non-Mexicans to 'own' anything.Mexico. Not all parts are dangerous & "gringo-hating."
I guess the point that I need to state flat out is that my criteria for a retirement location revolve around low (or no) taxes on investment income, low cost of living, plus a reasonable degree of personal security and a reasonable ability to 'own' some of the things that would make retirement nice (like a house and a boat) ! Also fairly important is the ability to establish 'Citizenship' in a country besides the USA as a hedge against potential changes in US retirement / tax laws.



However, in Mexico, couldn't my BF's family purchase a house for us in their names? I also believe that if I retire with my very own mexican, perhaps I'd feel a little safer.





very probably could ... however this would also mean from a legal and bank / asset standpoint that the house is theirs, not yours, even if you paid for it. If your BF is a Mexican citizen, he could also probably purchase a house himself. However this might raise a number of questions in regard to sources of income and taxation for your BF. Also, after you reside in Mexico for 183 days, you are considered a 'tax resident' for taxation of your own income from worldwide sources by the Mexican gov't. Also, NAFTA definitely has Mexican financial institutions on a course similar to Canada i.e. that any resident of the three NAFTA countries is going to have their asset, income and tax data shared among the tax agencies of all three NAFTA countriesHowever, in Mexico, couldn't my BF's family purchase a house for us in their names ?
"Mexico taxes it residents on worldwide income pursuant to Article 1 of the income tax law. It is important to note that Mexico allows for a foreign tax credit for any taxes paid outside of Mexico. The US and Canada also allow for foreign tax credits. In effect, the taxpayer will pay taxes in both countries, but will also have offsetting tax credits. The net result is that the taxpayer usually pays an amount of taxes equivalent to the highest tax bracket among both countries.
As of last year, Mexican financial institutions have begun to request that US citizens provide a US social security number in order to open an account in Mexico. While I have not heard if the SAT (the Mexican equivalent to the IRS) is sharing any information with the US at this point, this is clearly the intent. Once the Mexican authorities have access to the taxpayer's social security number they can also receive tax information from the IRS on that particular individual. Eventually, the US and Mexico will regularly exchange information on their taxpayers, just as Canada and the US do now.
If you have a bank account in Mexico that pays interest, the financial institution will withhold a small percentage of your principal for income taxes. If you are not a resident, this is the most you will pay on this particular income and you will not need to file a Mexican tax return. If you are resident, you can generally credit this amount on your annual Mexican tax return." from
I would also point out that, 'officially' Mexico levees an income tax of 25% on its 'tax residents'. While tax reporting and collections are hopelessly fraudulent at this point in time (as US dancing cash income was 10 years ago), there is no guarantee that the 'official' income tax won't be enforced with much greater effort in the future - particularly so if the US IRS winds up handing the Mexican SAT an official report of how much US income US citizen 'tax residents' of Mexico earned from US sources during the previous year ! If and when this happens, it will wipe out any and all tax benefits which are currently available to US citizens residing in Mexico versus the USA.
From a time value of money standpoint re 'retirement income' taxation, paying a 25% income tax versus paying zero income tax makes about a 30% difference in the actual amount of money available for annual spending given the same sized 'investment nest egg'.
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Last edited by Melonie; 10-18-2006 at 11:05 AM.



Melonie, you are making my head spin!!! Retirement sounds so stressful now!!!
I'm thinking either Belize or Turks & Caicos would be nice...they;re both very welcoming to Canadians.
Feature costumes for sale!



Belize would be safe. The British army uses it for jungle training which means there are always thousands of British soldiers there. Thousands. And of the soldiers that go, the SAS, Royal Marines and Commandos are going to be there a lot.
For me, Andorra looks fab. Quiet, clean, lots of skiing, low cost, low / no taxes, Barcelona is nearby (I love that place), no crime etc etc.
Or Antibes, Chamonix, the Tirol, Cyprus, Malta, Isle of Skye - there ae some wonderful locations in Europe. Ahh, dreaming...



I'm with Melonie on Andorra: it's the ultimate off-the-radar tax haven, it seems.
Regarding ^^^, the UK can also be a tax haven, if you're resident but not DOMICILED there, because in that case you're not taxable on foreign-sourced income not remitted to the UK. The same is true in Ireland. There has been noise about changing this, but currently, it looks like a good deal, as you can LEGALLY stash your money offshore and only be taxed on the income that you actually bring in to the UK, if you're not domiciled there. The hard part, as I see it, is to attain Indefinitely Leave to Remain status, and the risk that the rules will be changed. On the overall, that can make it a really sweet deal.





^^^ the 'kicker' where Andorra is concerned ... along with the Cayman Islands and the other countries that refused to sign the Terrorist Anti-Money Laundering Treaty (i.e. the sharing of financial information treaty) is that the US IRS, Homeland Security, FBI etc. have flourescent red flags waving regarding any US citizens who have financial and other dealings in these countries !



Indeed, Andorra seems to be one of the most secrecy-happy stable places left.
I'm not a U.S. citizen, so the non-resident taxation issue doesn't affect me. It's quite gruesome how U.S. taxes follow (or at least attempt to follow) U.S. citizens wherever they go and in that sense, it's the Andorras of this world that are probably most likely to attract IRS attention.
For all that's said, however, I suspect that any information sharing that does happen happens on the basis of the address that one gives, or possibly citizenship information actually provided. What I'm basically saying is, the CRA may share information with the IRS, but they only will (or do so effectively) if they actually know what information to share, and the presumably do that on the basis of the account's address-of-record.
I'm not keen on getting into trouble with the CRA, so I don't engage in these games, though I'm considering future taxpatriation. If I were American, I might consider it anyway: but, like you, I might have to consider making it a one-way move (possibly with eventual renunciation of citizenship) if I went in that direction.





Has anyone here looked at Panama or possibly Ecuador ?
I guess because it's Dollar Den that the question of "If you could retire anywhere?" gets money answers. But maybe I'm just a product of Literal Lounge, and if I could retire anywhere, it would be the place where I'd actually want to live for the quality of life, not the place with the best tax shelters.
I love it here. I'd retire about two ranges away from Denver, far enough to have solitude, and close enough to the airport to get to other places when I wanted to.





^^^ Panama is, on the surface, as good of a deal as Belize. However, in reality, Panama is pretty tight with the US IRS - meaning that even if Panama doesn't tax your earnings that the US still will. See Also, Panama retirement properties have been hyped pretty strongly making it tough to find bargains today.
Honduras is, I am told, still largely 'undeveloped' as an expatriate retirement zone. As such, real estate and cost of living are still very cheap. However, in Honduras the political climate has the potential for, shall we say, "excitement' at any time ! British Honduras i.e. Belize is almost as good of a deal with far less potential for 'excitement'.
see





I had a friend who went down there ( Panama) recently and he bought four lots on the beach - he didnt tell me the price but I know it was very cheap . H e went down and hooked up with some local people and bought the land directly through the owners , what Americans do down there is purchase land and or sell off property at inflated prices . So if you just go down there and deal with the owner one on one you pay a 1/4 of the cost . 30k will in most cases get you a beachfront lot . All the internet listings are rip-offs , they dont have MLS like we do . I can buy a fairly decent home ( New construction ) in a gated community for under 40 k . I like the fact that they use US currency as well because it makes the purchases much easier to understand without all the conversions .
Originally Posted by Melonie



FAO Clara - I'm not 100% on this, but I was under the impression that you don't need to be a US citizen for the IRS to follow you. As I understand it, once you have become a US resident, you have to complete their tax form every year for life or face possible consequences upon your next visit.
Don't misunderstand me, I'm no expert on US taxes. But, as I understand it, you can't just opt out of the US tax system by leaving the country.





that's the bottom line ! The only REAL way to opt out of the US tax system by leaving the country permanently is to move to one of the non-treaty countries like Andorra or Cayman Islands with all of your assets, resolve that you will never again need to set foot on US soil ever, and be prepared to have your US citizenship challenged (which may 'trap' you by preventing you from travelling outside of the non-treaty country unless the non-treaty country is willing to offer you citizenship and a new passport - which requires million dollar clout these days). And Stuart is correct that the IRS can legally tax the US earnings of citizens and non-citizens alike even if they are not residing in the USA - within the limits of any reciprocal tax treaty in effect with the country they ARE residing in.But, as I understand it, you can't just opt out of the US tax system by leaving the country.
we'd keep our house in whitefish montana (ski town, lakes, hiking, but gossipy, expensive, and cloudy) but how bout venezuela? brazil? we lokked t costa rica last year = too gringo'y, expensive, crowded roads, but good climate in centrl valley. its gotta be cheap, and have cheap health care.



I'm no expert either: you're probably right. I even remember reading somewhere that they'll try to tax former citizens if they determine that they expatriated to avoid taxes. Ugh.
I guess what I should have said would have been along the lines of "As a person with absolutely no connection, real or imagined, to the U.S., this isn't a concern for me, but..."
As a bit of a followup on Melonie's post below, if I were to be a U.S. citizen and to engage in what I'll best term "hostile taxpatriation," I certainly wouldn't do it before securing another citizenship first. I'd also be very careful regarding the possibility of extradition for tax offences: my understanding is that tax offences aren't usually included in extradition treaties, but who knows what might be there in some cases. That being said, I know several U.S. citizens who have been lifelong foreign residents (& dual citizens) who simply ignore the whole mess, to no ill effect SO FAR. I'm sure that when they don't catch enough "terrorists" in all the new nets, they'll redirect their efforts to nailing these people for tax offences when they visit the U.S. I have also met others who are so scared of the IRS that they declare the $0.37 of bank interest they received (something almost no Canadian would bother with unless the bank were to issue a tax slip, which they don't have to do when the amount is below $50).
In short, being a "U.S. person" has some seriously painful tax & privacy consequences, that much is obvious.
Originally Posted by StuartL
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