Yes, well, it can be. It depends on where you’re going, how you define a smart move, and a lot of other things about your circumstances. How their currency compares to the US dollar is probably the biggest factor here financially. If you are planning to move to say, London, it’s going to be a lot more expensive than if you move to Panama for example.
How the currency will compare in say, twenty years from now is also something to consider. It’s hard to say what the global and domestic economy will be like when you’re ready to retire, and this will play a part in your cost of living. If you’re trying to base your location entirely on cost of living you’ll want to come up with a couple different locations in case things change between now and the time you’re ready to move. If you have children or other family you spend a lot of time with you’ll also want to consider that in your decision. Not just for emotional reasons, but for financial ones, too. If you’re going to be flying back to the united states every other week to visit your new grandchildren then living in a cheaper country may not be cheaper overall anymore.
This decision can also be considered smart because it will be a new adventure. In retirement you’ll be looking for new things to do with your time as you adjust and living in a foreign country will certainly help with that. You’ll have all sorts of new and interesting things to do already built into your new everyday life, meaning you’ll have less need to make extravagant purchases in your search for new things to do with your time to keep life exciting. Keeping your life exciting is something that is often overlooked in retirement planning but really shouldn’t be. Your life is not over when you stop working at your job, and you’ll want new and interesting things to do and this is something you’ll want to think about when planning your budget. If there’s something you’ve always wanted to do but never had the time for, plan on that being a part of your retirement life and plan for it in your budget.
As you can see whether or not it is smart to retire outside of the US is really a personal question, but depending on where you go, what you’re hoping for in your later years, and your overall circumstances it can be one of the smartest decisions you can make.
About the Author:
To make your retirement goals happen you’ll need to build a strong financial plan. Learn more about your retirement savings options like 401k and IRA savings plans, maximum contribution limits, and what your IRA and 401k account balance should be.