I R'ed only somewhat E this year. We then moved to Bangkok, a change for which we have been planning several years. It's early days yet, but we are delighted with our choice so far. We moved from New York City which inevitably forms the basis for our comparisons.
Advantages: Cheaper cost of living. We rent an apartment in a full-service building in an excellent neighborhood that provides twice the living space for 2/3's the cost of our place in Manhattan. Near to excellent, low-cost public transportation. A tax ride across town cost me $3 the other day. Electricity is 30% of NYC costs.
Stimulation of being in a new culture. I started teaching myself Thai a year before we moved and could read and write it in a limited way before we came. I am studying now in a one year intensive program now that will bring me up to functional level. But I am determined to become fluent which will take some years longer. For me this study is very enjoyable. My wife is already fluent in Thai and English.
Health care. We do not worry about either the cost or the quality of health care, even if we pay out of pocket. You go to the dentist and ask to see the price list and he shows you the price list. By contrast, a 48 year old family member with a wife and three kids in CT just got denied health coverage because he takes Lipitor. He's out of a job and now in a crisis. I can't tell you what a joy it is to be free of the execrable US health care system and to be beyond the risk of bankruptcy due to medical costs.
Taxes. We won't have to pay state (or local) income tax again. I'll complete our Roth conversions before age 70 in the 15% bracket. In NYC, because we were still earning, we were in the 37% total bracket.
Personal safety is not an issue here as it is in Latin America.
But there are disadvantages, of course:
Miss the friends and family. Skype is a big plus.
Not all aspects of Thai culture are so charming.
Although tasty, Thai food is not very healthy, but then US restaurant food isn't either, with some exceptions. Thais fry everything and then douse it with MSG. But if you cook at home the ingredients are better than the US. Limes are exceptional, for instance. Chicken is better. Beef is worse, but we don't eat it.
the weather. Very nice right now, but not so nice for much of the year.
Bangkok floods. Our neighborhood didn't, but family members were affected.
Political tensions simmer below the surface and could become violent again. Although i was surprised to find that the Gini coefficient for the US is actually higher than Thailand.
Poor road safety. Accident rate per capita of twice the US. But we don't drive and travel in cars outside the city very rarely. If I had to drive here, I wouldn't have come.
The dollar will probably resume its decline after the current flight to safety runs its course. This is a huge risk since our assets will always be in dollars while our liabilities are in Thai baht. I have made an attempt to cope with this risk, but it remains to be seen how successful it will be.
So, I know that we could probably have realized similar savings in the cost of living if we had moved to Atlanta or Boise. But Bangkok is more interesting than Atlanta or Boise.
I had estimated a 25% lower cost of living here in Bangkok than in NYC during retirement. That was probably a conservative estimate. But a savings like that in the after-tax bottom line is huge. Much better than a similar investment gain. For this reason I think some folks whose finances are borderline should consider expatriating and should do so early in retirement so that the savings have the biggest impact. It's also easier to cope with relocation the younger you are. It goes without saying that expatting is not for everyone. If you think you wouldn't like it, you wouldn't.
But the biggest improvement for me was not moving to Bangkok, it was retirement itself. Having my day to myself again is just incomparable.
Advantages: Cheaper cost of living. We rent an apartment in a full-service building in an excellent neighborhood that provides twice the living space for 2/3's the cost of our place in Manhattan. Near to excellent, low-cost public transportation. A tax ride across town cost me $3 the other day. Electricity is 30% of NYC costs.
Stimulation of being in a new culture. I started teaching myself Thai a year before we moved and could read and write it in a limited way before we came. I am studying now in a one year intensive program now that will bring me up to functional level. But I am determined to become fluent which will take some years longer. For me this study is very enjoyable. My wife is already fluent in Thai and English.
Health care. We do not worry about either the cost or the quality of health care, even if we pay out of pocket. You go to the dentist and ask to see the price list and he shows you the price list. By contrast, a 48 year old family member with a wife and three kids in CT just got denied health coverage because he takes Lipitor. He's out of a job and now in a crisis. I can't tell you what a joy it is to be free of the execrable US health care system and to be beyond the risk of bankruptcy due to medical costs.
Taxes. We won't have to pay state (or local) income tax again. I'll complete our Roth conversions before age 70 in the 15% bracket. In NYC, because we were still earning, we were in the 37% total bracket.
Personal safety is not an issue here as it is in Latin America.
But there are disadvantages, of course:
Miss the friends and family. Skype is a big plus.
Not all aspects of Thai culture are so charming.
Although tasty, Thai food is not very healthy, but then US restaurant food isn't either, with some exceptions. Thais fry everything and then douse it with MSG. But if you cook at home the ingredients are better than the US. Limes are exceptional, for instance. Chicken is better. Beef is worse, but we don't eat it.
the weather. Very nice right now, but not so nice for much of the year.
Bangkok floods. Our neighborhood didn't, but family members were affected.
Political tensions simmer below the surface and could become violent again. Although i was surprised to find that the Gini coefficient for the US is actually higher than Thailand.
Poor road safety. Accident rate per capita of twice the US. But we don't drive and travel in cars outside the city very rarely. If I had to drive here, I wouldn't have come.
The dollar will probably resume its decline after the current flight to safety runs its course. This is a huge risk since our assets will always be in dollars while our liabilities are in Thai baht. I have made an attempt to cope with this risk, but it remains to be seen how successful it will be.
So, I know that we could probably have realized similar savings in the cost of living if we had moved to Atlanta or Boise. But Bangkok is more interesting than Atlanta or Boise.
I had estimated a 25% lower cost of living here in Bangkok than in NYC during retirement. That was probably a conservative estimate. But a savings like that in the after-tax bottom line is huge. Much better than a similar investment gain. For this reason I think some folks whose finances are borderline should consider expatriating and should do so early in retirement so that the savings have the biggest impact. It's also easier to cope with relocation the younger you are. It goes without saying that expatting is not for everyone. If you think you wouldn't like it, you wouldn't.
But the biggest improvement for me was not moving to Bangkok, it was retirement itself. Having my day to myself again is just incomparable.