Retiring to Canada

[kcowan]

You could retire to Canada in the Investor category if you have a minimum net worth of $800,000.

That has changed this year. It is now doubled to $1.6 million.

 

[dex]

That has changed this year. It is now doubled to $1.6 million.

One aspect for an USA citizen thinking about retiring in Canada is the exchange rate risk. The Canadian $ is near parity with the USA$. My guess is that the C$ will be a strong currency in the future. This means that US$ investments/income will be worth less in the future in Canada.

 

[Alan]

That has changed this year. It is now doubled to $1.6 million.

Inflation is tough in Canada.

 

[Richard8655]

kcowan, dex, Alan - you guys are all correct in these additional obstacles and risks. I'd also add that everything (to me at least) seems to cost 25-50% more in Canada for the identical items in the States. New cars stickers have whopping price tags. Also no prescription drug coverage there at any age, unlike Medicare Part D here.

 

[kcowan]

kcowan, dex, Alan - you guys are all correct in these additional obstacles and risks. I'd also add that everything (to me at least) seems to cost 25-50% more in Canada for the identical items in the States. New cars stickers have whopping price tags. Also no prescription drug coverage there at any age, unlike Medicare Part D here.

The higher prices are due to higher taxes needed to fund universal healthcare. The only fair comparison would be to include all taxes and health plan premiums to get a direct comparison between the 2 countries cost of living. Canada usually fares well in total costs when compared to major states but is more expensive than some of the southern states.

Most provinces have a drug plan. In BC it is called pharmacare and it is means-tested. Make too much in a given year and you subsidy goes away. But your prices for drugs are lower to begin with. And your usage of drugs will be much less too.

 

[Richard8655]

The higher prices are due to higher taxes needed to fund universal healthcare. The only fair comparison would be to include all taxes and health plan premiums to get a direct comparison between the 2 countries cost of living. Canada usually fares well in total costs when compared to major states but is more expensive than some of the southern states.

Most provinces have a drug plan. In BC it is called pharmacare and it is means-tested. Make too much in a given year and you subsidy goes away. But your prices for drugs are lower to begin with. And your usage of drugs will be much less too.

GST and PST resulting in about 15% sales tax, plus higher income taxes, are what fund social services like universal health care. The reason for higher prices as part of the higher cost of living is an economic and demographic issue. At one tenth the U.S. population spread across vast remote regions, the sales volume and demand to keep costs low doesn't exist. Transporting goods to fewer people across large distances results in significantly higher prices. Competition is also less due to fewer customers/buyers, contributing to higher prices.

I don't think Ontario has a universal, non-means tested drug plan. And the means tested BC plan you mention is more like Medicaid for the poor and destitute here, which I would not compare as similar to the universal, non-means tested federal program Medicare Part D.

 

[kcowan]

GST and PST resulting in about 15% sales tax, plus higher income taxes, are what fund social services like universal health care.

The rates are 12% and 13% in the 2 provinces being discussed.

I don't think Ontario has a universal, non-means tested drug plan. And the means tested BC plan you mention is more like Medicaid for the poor and destitute here, which I would not compare as similar to the universal, non-means tested federal program Medicare Part D.

I agree that the US plan is more socialist than either Ontario's or BC's. But basing a public plan on financial need is always a good idea.

 

[keegs]

Richard,

If this hasn't been asked and if you also don't mind me asking, how will US FICA benefits be affected by your reloc?

On another somewhat related note, the Mrs. is still a resident alien here after 30 years of marriage. I'm wondering if dual citizenship provides more flexabilty with any of this?

Regards...and best wishes

 

[Richard8655]

Keegs,

By FICA benefits, do you mean receiving social security benefits while residing in Canada? If so, no difference other than I'd need to include that as part of my world-wide income when filing annual tax returns with Revenue Canada.

If the Mrs. is a U.S. resident alien (green card holder) and a dual citizen of another country, it doesn't make any difference as far as reporting income for both of you in the U.S. Her income and yours are taxable.

Hope I understood correctly. If not, please clarify.

 

[keegs]

Keegs,

By FICA benefits, do you mean receiving social security benefits while residing in Canada? If so, no difference other than I'd need to include that as part of my world-wide income when filing annual tax returns with Revenue Canada.

If the Mrs. is a U.S. resident alien (green card holder) and a dual citizen of another country, it doesn't make any difference as far as reporting income for both of you in the U.S. Her income and yours are taxable.

Hope I understood correctly. If not, please clarify.

For some reason I wasn't sure whether our SS benefits followed us overseas. Good to know.

I know these things can get complicated but by FICA I also meant to include Medicare benefits. So if for instance you were to become ill on travel to the US, my understanding is that your medical bills would not be covered by the Canadian system. If that's correct then would you be covered by Medicare while in the US?

The Mrs. is a green card holder and a Swedish citizen only. If we were to reside there I suppose SS would follow us as well and be taxed accordingly.

Relative to medical coverage, after turning 65 the Mrs. will become eligable for Medicare here. My understanding is that while traveling to Sweden, if necessary, she could access the healthcare system there as well.

Gotta protect that nest egg...if you know what I mean.

TIA

 

[DangerMouse]

Or you fled to there in the 60's to avoid the draft ...

BTW, Australia also has a "two level" system for health care. Our guide told us (when we traveled there) that she would not go to a hospital in the public plan. BTW, half the folks there are also enrolled in the private system:

About Australia: Health Care in Australia

Everyone in Australia is entitled to use the medicare system. I would say 99.99% of visits to General Practitioners are done thru the medicare system. We do have private health insurance which is in addition to the medicare system. Basically if you earn over a certain amount you are expected to take out private insurance, if you don't you will pay an additional medicare levy when you submit your tax return.

My MIL is an example of someone who has both. Often she will be admitted to hospital as a private patient, however she goes to the same hospital she would under medicare, sees the same Dr she would under medicare and she may get her own private room or she may end up in a shared room as she does for medicare. Only difference is for the snob value she will end up with a bigger bill to pay.

Private health insurance premiums in Australia are approved by the Govt. When we last lived in Oz in 2005 we were paying $200 a month approx. (a couple) and that covered medical, dental, chiropractor. Pharmaceutical benefits are all paid under medicare and the government tells the drug companies what they are allowed to charge.

Dex, you mentioned the Gold Coast, in Oz this area is commonly known as BrisVegas so that will give you some idea of what you could expect.

 

[Richard8655]

For some reason I wasn't sure whether our SS benefits followed us overseas. Good to know.

I know these things can get complicated but by FICA I also meant to include Medicare benefits. So if for instance you were to become ill on travel to the US, my understanding is that your medical bills would not be covered by the Canadian system. If that's correct then would you be covered by Medicare while in the US?

The Mrs. is a green card holder and a Swedish citizen only. If we were to reside there I suppose SS would follow us as well and be taxed accordingly.

Relative to medical coverage, after turning 65 the Mrs. will become eligable for Medicare here. My understanding is that while traveling to Sweden, if necessary, she could access the healthcare system there as well.

Gotta protect that nest egg...if you know what I mean.

TIA

Yes, if a resident or citizen of Canada travels to the U.S., they are not covered by Canadian healthcare. The advise for Canadians is to buy U.S. healthcare insurance in advance for the time spent in the U.S.

I don't see why a U.S. citizen who is also a Canadian resident couldn't also be covered by Medicare (if eligible) when in the U.S. But I don't know if Medicare follows its enrollees outside the U.S. if they reside there, in covering medical expenses and charges.

Per the comment on Australian health care coverage for public or private options, in Canada private medical services are by and large illegal. As it was explained to me when I asked about this at the local Canadian goverment walk-in clinic, private coverage would allow people to "jump ahead in line" in creating a 2-tier system where those with money get faster care. This is what the Canadian system avoids and prevents in ensuring equal access not based on affordability. However, a recent Supreme Court of Canada ruling opened the door to private health care, so this situation may change (unfortunately).

 

[DangerMouse]

Reason they created the two tier system was to take some of the pressure off the medicare system. Of course it does allow the queue jumping, but it also removes all pretense that we are all created equal and confirms money does talk. However, I would say for treatments such as cancer it makes no difference. Where the private helps is if say you require knee replacement surgery you might be able to get it done quicker.

 

[kumquat]

Canada allows private treatment and queue jumping. We call it "medical tourism".

 

[kcowan]

Canada also has private insurers for dental, drugs and various advanced screening centres.

 

[Richard8655]

Canada allows private treatment and queue jumping. We call it "medical tourism".

Meaning going to the States?

 

[Meadbh]

Meaning going to the States?

No, there are much cheaper places. e,g, Asia, Eastern Europe...

 

[kumquat]

Meaning going to the States?

Only for politicians.

No, there are much cheaper places. e,g, Asia, Eastern Europe...

+1

 

[Rob]

All of the posts so far seem to be from people who are dual citizens or permanent residents or striving to be permanent residents of Canada. I have close friends in Canada that invite me to live there as long as I want. I've got a room in their house and have lived there for 6 months or more at a time. As Americans, we can stay for six months at a time. My passport is never stamped at the border when driving across.

I am 64, plan on using Medicare, but also plan on having a stateside address.

Rob

 

[dex]

All of the posts so far seem to be from people who are dual citizens or permanent residents or striving to be permanent residents of Canada. I have close friends in Canada that invite me to live there as long as I want. I've got a room in their house and have lived there for 6 months or more at a time. As Americans, we can stay for six months at a time. My passport is never stamped at the border when driving across.

I am 64, plan on using Medicare, but also plan on having a stateside address.

Rob

Do you buy health ins. coverage for your time in Canada?

Also, if your passport is not stamped how do they know how long you stayed?

 

[Richard8655]

All of the posts so far seem to be from people who are dual citizens or permanent residents or striving to be permanent residents of Canada. I have close friends in Canada that invite me to live there as long as I want. I've got a room in their house and have lived there for 6 months or more at a time. As Americans, we can stay for six months at a time. My passport is never stamped at the border when driving across.

I am 64, plan on using Medicare, but also plan on having a stateside address.

Rob

Yes, you can stay there for up to 6 months but you can't use any services like healthcare if not a permanent resident (otherwise you'll be billed). So except for sightseeing and being with friends, there's no other benefit. Medicare (U.S.) won't cover any medical expenses while there.

 

[kumquat]

All of the posts so far seem to be from people who are dual citizens or permanent residents or striving to be permanent residents of Canada. I have close friends in Canada that invite me to live there as long as I want. I've got a room in their house and have lived there for 6 months or more at a time. As Americans, we can stay for six months at a time. My passport is never stamped at the border when driving across.

I am 64, plan on using Medicare, but also plan on having a stateside address.

Rob

I''m a Canadian citizen who spends some time in the US. There are similar problems for both of us. I haven't said much but:

1. Stamps on passports are so old technology. Both Canada and USA know where you are when, think scanning bar-codes.
2. Neither Canada nor USA cares much where you are except for taxation purposes. As far as health care goes, you must have proof of residence (and other eligibility) in the province you live in. Otherwise you will be charged (at a rate that you may like). This also applies to Canadian citizens, although they will probably be reimbursed.
3. Stay in Canada 185 days in any year and you are subject to Canadian income tax. Note that the days do not have to be contiguous. Note also that Canada's income tax is probably higher than you will pay in USA. One example is "tax free muni's". All income is taxed in Canada. Note too, that if I spend 185 days in USA, I'm subject to US income tax. My tax bill probably won't change (due to tax treaties and Cdn tax rates) but Canada has no "death tax", I might be subject to it (and will be depending on US assets).

By all means come up here and party. We'll show you a good time and you'll like it. It will be a detriment to ER, though, unless you have permanent residency or citizenship.

 

[Rob]

Hi. My health insurance is with IHI, from Belgium. It's an international policy that covers me in all countries of the world. You can only get the policy if you are living and working overseas, and then once you have it, it is guaranteed for life even if you return to the N. America. I've used it in Quebec, as long as I pay the deductible.

As for Medicare, living in an area close to the US allows you to seek medical care in the US if you so desire. I have not tried that yet, but it certainly is possible. You just have to be wiling to make the short trip to the States. I've had friends that have done that from other countries that they retired to.

There are many Canadians who have bought property in the US for retirement and spend a good part of the year in the states living in their home as Canadian citizens. If they spend less than 6 months in the States, they still qualify for the free medical care in Canada if they are willing to fly there.

Rob

 

[Richard8655]

Adding a note to the subject of this thread. In looking at U.S. Medicare Part B, it seems those costs will be going up annually. For a couple it's now $2400+. Although I'm not there yet (58), I wonder if this is a concern for those there now or planning for it. And this would be on top of premiums for any retiree coverage that would then become secondary or suplemental. Seems these are non-issues for Canadians at any age (not that their system is perfect either).

 

[kcowan]

As for Medicare, living in an area close to the US allows you to seek medical care in the US if you so desire. I have not tried that yet, but it certainly is possible. You just have to be wiling to make the short trip to the States. I've had friends that have done that from other countries that they retired to.

We have a friend who is a US citizen and collects his social security even though lives in PV fulltime. He needs a bypass operation and is going to dallas at month-end to have the operation. It is covered by the VA.

There are many Canadians who have bought property in the US for retirement and spend a good part of the year in the states living in their home as Canadian citizens. If they spend less than 6 months in the States, they still qualify for the free medical care in Canada if they are willing to fly there.

They must complete a form each year claiming a close affiliation with Canada if they spend more than 30 days living in the US. The form enables them to live there for 183 days wihout filing tax returns. As resident aliens, they are liable for US estate taxes upon death. This is uncertain as it is changing next year.