As some of you may remember, we lost my FIL suddenly and unexpectedly a couple of months ago. He was retired in South America and died at his home there. Since that time, we've been working on getting his estate taken care of, a process that isn't terribly complicated but will take time. However, there are several things that I've noticed that I think might be useful for those of us considering a move overseas after retirement. Not all of these are from our personal experience; some of them are "Gee, if X had happened, what would we have done?" So some of them may be lesser issues. Still, I thought I'd share. More may come later.
1. How will your loved ones and/or personal representatives be notified if you're suddenly taken ill, become seriously injured, or die? In our case, we were lucky, as my FIL's wife called us immediately.
2. How do you want your remains handled, and what's the process for that in your country of residence? Find out and write it down in a letter of instruction for your personal representative. Send it to them while you can discuss it. Sure, it's uncomfortable, but it's a LOT easier to do this yourself than to have your loved ones trying to figure it out on a scratchy international phone call to the U.S. Embassy in whatever country you're living in.
3. When your family or personal representative has to fly to the country you've retired to, either to take care of you during a serious illness or injury, or to figure out what to do after you've passed away, who is going to pay for the plane ticket? These are not cheap tickets, and if you think your estate will cover the cost... maybe it will, in a year or so. Can your personal representative float anywhere from two to several thousand dollars in last expenses for a year until your estate settles? If you're going to leave them the money for this in a TOD account, it will still take at least a month for them to get the cash. What if you have high medical expenses that have to be paid before you can leave the hospital? What if your rent or life insurance comes due and you can't access your normal checking accounts? What if your local bank's assets are seized by the government and you lose all your in-country monies?
3. How will you streamline your estate? This is an especially important issue if you plan on purchasing real estate in the country you'll be living in. When you die, U.S. law may or may not have any jurisdiction over those assets. How does the estate process work in your country of residence? For U.S. assets, will you need to show that you were domiciled in the U.S. even though you lived elsewhere? How will you do this?
4. What happens if you get married or have kids in your new country of residence? Be sure to update your will and consult an estate attorney with experience in this sort of thing, because it can really complicate issues for everyone you leave behind if you're not on top of it. For example, what part of your estate is going to go to your new spouse? New kids? Old kids? What does the country you reside in require? (it may be a lot different from what the U.S. requires). If you do remarry and your spouse is not a U.S. citizen or permanent resident of the U.S., they will not be eligible for Social Security benefits. At all. How will this impact their income, especially if they've quit a job to stay home and take care of you as you age?
5. If you have domestic help, think about what will happen to them when/if you die. For example, how will they collect their final paychecks? How will your personal representative know how much to pay them, or how to pay them (cash, check,
)? This may be especially an issue if your domestic staff is live-in -- they've suddenly lost home and employment.
6. If you're like most expats these days, large and important parts of your life will be conducted over the internet. And if you're like most internet users these days, you'll have a lot of different passwords. Please, please, please figure out a way to get those passwords to the people who will need them after you're gone. If you conduct your investments and banking online, you may not even have tax forms sent to your address, so your heirs may not even be able to find your bank accounts, not to mention your email accounts.
7. As DH just said: really consider the costs of flying back to the U.S. on a regular basis to visit family and friends, especially if you have or will have grandkids. We saw my FIL one or two times a year, and were lucky to see him even that much, given that his kids were on both coasts and in the midwest. A trip to visit everyone was long, expensive, and covered a lot of miles. How are you going to finance this? And don't say "Oh, I'll be living in a wonderful, inexpensive location. They'll come to see me!" Your kids, much as they miss you, are going to have a hard time swinging the costs to visit you on a regular basis, especially if they've got kids to bring along, too. And they may not want to have ALL their vacation time and vacation money, every year, spent on going to the same location, no matter how fabulous it is.
8. What will happen when and if you become permanently disabled? My FIL's widow came to stay with us for his U.S. memorial service, and one of the things she said to me was "I don't know what we would have done if he had become permanently disabled and needed nursing home care -- we just couldn't afford it." And Medicaid would only have covered him if he lived in the U.S. So would she have moved back to the U.S. with him, leaving her job and family behind? Could she have gotten a green card? Work? When you look at the availability of health care in your country of choice, you also need to consider the long-term care options, since you likely won't have family networks to care for you in your dotage (unless you marry someone from there...).
9. Can you afford to relocate if things go south in your chosen country of abode? Political climates change, policies are made or abolished. As an expat, you won't have the same or maybe as many rights as a citizen -- what would you do in those situations?
I don't think that retiring abroad is a bad idea, but I do think that it bears careful consideration, especially as regards estate planning and social services / eldercare. So many things are different, even in cultures that appear to be close to ours. I think it's a great idea for some, but if you are going to retire abroad, take some time to take care of the details earlier rather than later.