RE in a cheaper country, problem in returning back to mother country

[landover]

A hypothetical situation, A person REed in a cheaper cost of living country. That person has enough money to live a quality life at the cheaper destination.

Now something happened (Exchange rate turned worst, VISA, tax, health, etc.), that person is forced to return to original country. But now the challenges start, the money which was sufficient in the cheaper country, is not sufficient, (WR is much north of 4%). Most skills are outdated so getting a good paying job is difficult. Some may find difficult to get health insurance. Leaving family behind in some cases.

So how to prepare for this situation, should have enough to RE in your original country only then retire in a cheaper country and live like king?

 

[Texas Proud]

A strange question in a way....

Let's change it to.... the market crashes over a 10 year period and you can see the writing on the wall that your portfolio will not make it... what do you do IOW, living in another country is not the issue as I see it...


But, to answer your question..... move to a different cheap country... I can guarantee that there always will be countries out there that will be cheaper to live in than here... (well, at least for the next 100 years or so)....

 

[devans0]

Having skills in getting things done in a new country can be used for new paying opportunities. In worst cases, even w**k. The key is keeping some marketable skills up enough to employ. I'm sure that the dream of easy living from someone who has been there, and can show how it is done would be a marketable skill for sales, travel agencies, corporations with an interest in setting up in a new country...etc..

Seeing how a different culture confronts their problems is broadening. The solutions that work in an area that that hypothetical un-RE person is familiar or used to work in, would open a number of doors, too. If retirement is an excuse to laze away, you could paint yourself into a corner. If you live with some zest, you should land on your feet.

Read "What Color Is Your Parachute". It offers a lot more pragmatic advice on how to accomplish what I describe. My personal plan is to have enough stashed away to cover that possibility, and LBYM in the new home to continue to build wealth.

 

[Lancelot]

A strange question in a way....

Let's change it to.... the market crashes over a 10 year period and you can see the writing on the wall that your portfolio will not make it... what do you do IOW, living in another country is not the issue as I see it...


But, to answer your question..... move to a different cheap country... I can guarantee that there always will be countries out there that will be cheaper to live in than here... (well, at least for the next 100 years or so)....

I agree with Tex- if country A becomes relatively expensive, then seek ouy country b or c. Always a party some where

 

[skyvue]

A hypothetical situation, A person REed in a cheaper cost of living country. That person has enough money to live a quality life at the cheaper destination.

Now something happened (Exchange rate turned worst, VISA, tax, health, etc.), that person is forced to return to original country. But now the challenges start, the money which was sufficient in the cheaper country, is not sufficient, (WR is much north of 4%). Most skills are outdated so getting a good paying job is difficult. Some may find difficult to get health insurance. Leaving family behind in some cases.

So how to prepare for this situation, should have enough to RE in your original country only then retire in a cheaper country and live like king?

If you run out of money and need to go back to work with rusty professional skills, move to North Dakota! I read an article recently that said they have 3% unemployment and are needing to pay $12-15 dollar per hour just to staff jobs like McDonalds. The oil and natural gas industry is booming in that area and pay $30+ dollars per hour for basic labor jobs in the oil fiels. Many of the skilled jobs are paying much more.

After reading this I wonder why so many people are suffering with their families in poverty in metro areas like Detroit, Cleveland, etc.. when all they need to do is move to get a good job (or at least a job good enough to pay for their basic needs)? Perhaps if our social programs weren't constantly extending benefits, it would force some folks to make these type moves.

 

[ItDontMeanAThing]

A hypothetical situation, A person REed in a cheaper cost of living country. That person has enough money to live a quality life at the cheaper destination.

Now something happened (Exchange rate turned worst, ....

More than hypothetical for US expats who've been down about 20% in the exchange rates at times in the last five years against the Thai baht and Philippine peso.

So how to prepare for this situation, should have enough to RE in your original country only then retire in a cheaper country and live like king?

Living off investments in retirement is a crap shoot no matter where you are. Only way I was emotionally able to take the plunge was to find a couple places I could live with a monthly cost that was half of what I the calculators say was expected from my investments.

I'm LBYM in retirement because I'm now living off my taxable accounts, will be living off my IRA in a few years with some SS after that. Can't imagine not LBYM in this situation.

There are always other cheaper countries, but does one want to live there? I have an English friend who could no longer afford Crete. Moved to the Philippines and can't stand the place after a year. He's now researching Thailand. Based on what is on his 'must have' list Thailand isn't going to make the cut. Then what does he do? Or read about the expats who could no longer afford Costa Rica because too many foreigners drove prices up. Many moved to Granada, Nicaragua. It's a place to live but it's not the same thing. Not ever close.

 

[arebelspy]

DW and I have talked about RE to another country, but our plan is to have enough to RE here in the states, and then RE elsewhere and the excess we have from the lower cost of living can be saved and reinvested. In other words, get to where a SWR would be sufficiently comfortable here, and just have an even lower SWR in the other country.

 

[FUEGO]

DW and I have talked about RE to another country, but our plan is to have enough to RE here in the states, and then RE elsewhere and the excess we have from the lower cost of living can be saved and reinvested. In other words, get to where a SWR would be sufficiently comfortable here, and just have an even lower SWR in the other country.

I think that would be our plan if we wanted to live abroad. Have enough to live stateside with a reasonable SWR. Then either live it up in a cheaper foreign country and/or reduce our withdrawal rate, effectively reinvesting the amounts we save by living in a lower cost area.

 

[Aiming_4_55]

Anyone ever look at college cost in a different country?

I've heard of students applying/attending medical school out of the country, but that is due to competitiveness of admission from what I understand.

I've been playing with sponsoring a child in an orphanage to attend university in Manila. With tuition, books, food, etc. it would be about 3-4k per year. There appears to be a handful of families willing to do this, so it might only be 500 per year per family.

Then I stop to think, if I relocated my family there at ER of 55, what I'm saving for my kids college fund can stop now! Something to think about!

 

[FIREd]

Personally, I would want to have enough to retire stateside even if I decided to retire more cheaply abroad. Things happen. You might get homesick. You might have to move back here to take care of a relative. The dollar might plunge further. I have been living "abroad" for 15 years and I think it is very important to keep your options open.

 

[DangerMouse]

Personally, I would want to have enough to retire stateside even if I decided to retire more cheaply abroad. Things happen. You might get homesick. You might have to move back here to take care of a relative. The dollar might plunge further. I have been living "abroad" for 15 years and I think it is very important to keep your options open.

I'll agree entirely with the importance of keeping your options open. We've been expats for the majority of the past 20 years.

For us the difficulty is fitting back into the country of our origin (Australia). We will always make sure we have a foothold financially so we can return to live if we desire.

However we are being sure to keep our options open with remaining in the US or going back to Europe to live as well.

 

[Nords]

Anyone ever look at college cost in a different country?
I've been playing with sponsoring a child in an orphanage to attend university in Manila. With tuition, books, food, etc. it would be about 3-4k per year. There appears to be a handful of families willing to do this, so it might only be 500 per year per family.
Then I stop to think, if I relocated my family there at ER of 55, what I'm saving for my kids college fund can stop now! Something to think about!

I don't know if that's helping your kids. Not all college degrees transfer to all countries.

When I was at my last military command I worked with two senior enlisted instructors who were trained as machinery repairmen. (Given a lathe, with enough supplies and time, they could make anything-- and they frequently did.) They'd grown up in the Philippines and emigrated after getting their PI college degrees, eventually becoming American citizens. If they'd joined the PI Navy then they would've been commanding officers by that point in their lives. But because their degrees weren't recognized in the U.S., they were senior enlisted. The Navy got a heckuva deal out of that.

Meanwhile another shipmate had been stationed in Yokosuka for nearly 20 years, and both of his sons were attending U of Tokyo. When Dad retired, one of the sons had just started teaching English after graduation and the other one was still enrolled in the college. Dad & Mom returned home to their dream house while their sons stayed in the country they knew best. I don't know if a Japanese college degree transfers to American institutions, but they were earning a good living in Japan and had no need to care what corporate America thought of their degrees.

 

[Lancelot]

I don't know if that's helping your kids. Not all college degrees transfer to all countries.

Often for good reason. I once met a thai lady that supports herself and young daughter by writing thesis and other research papers for university students here in Chiang Mai

 

[BunsGettingFirm]

A strange question in a way....

Let's change it to.... the market crashes over a 10 year period and you can see the writing on the wall that your portfolio will not make it... what do you do IOW, living in another country is not the issue as I see it...


But, to answer your question..... move to a different cheap country... I can guarantee that there always will be countries out there that will be cheaper to live in than here... (well, at least for the next 100 years or so)....

Oh, that's going to be a problem because I plan to live for another 200 years.

That's why I plan to live on 1/2 of my income even in retirement. Otherwise, I would have left already.

 

[Nords]

Often for good reason. I once met a thai lady that supports herself and young daughter by writing thesis and other research papers for university students here in Chiang Mai

Yeah, in that case I'd say that American transfer credits would be irrelevant.

So, how much do you get for a master's thesis?

 

[Lancelot]

Yeah, in that case I'd say that American transfer credits would be irrelevant.

So, how much do you get for a master's thesis?

Me?

 

[Aiming_4_55]

I don't know if that's helping your kids. Not all college degrees transfer to all countries.

Point taken. My only experience has been meeting professionals with Compuer Science / IT type degrees. At least from my limited experience, they appear to know the basics for entry level to mid-experience positions in the Midwest. Depending on the kid, university, field of study, one's outcome may vary... YMMV

 

[Texas Proud]

Oh, that's going to be a problem because I plan to live for another 200 years.

That's why I plan to live on 1/2 of my income even in retirement. Otherwise, I would have left already.

OK.... I can go on a limb and say that there will be cheaper places to live than the US for the next 200 years....

There ya go....

 

[landover]

Thanks all for your repliles.

A strange question in a way....

Let's change it to.... the market crashes over a 10 year period and you can see the writing on the wall that your portfolio will not make it...

But, to answer your question..... move to a different cheap country...

I guess this is strange since I am not sure how better to put this. Market crash (or meteor strike...) is something which is always a non zero probability. I guess by this logic one should work till not physically able to continue. I guess if one has 10-15 yrs of good retirement at relatively early age what else one can want.

There are always other cheaper countries, but does one want to live there?

Yes this is always a concern if money is tight. What is the other option, work a minimum wage job?

DW and I have talked about RE to another country, but our plan is to have enough to RE here in the states, and then RE elsewhere and the excess we have from the lower cost of living can be saved and reinvested. In other words, get to where a SWR would be sufficiently comfortable here, and just have an even lower SWR in the other country.

Personally, I would want to have enough to retire stateside even if I decided to retire more cheaply abroad. Things happen. You might get homesick. You might have to move back here to take care of a relative. The dollar might plunge further. I have been living "abroad" for 15 years and I think it is very important to keep your options open.

I guess this is fundamental, SWR should be sufficient for bare bones living with some padding. Hopefully SWR will grow with saving from cheaper cost of living.

 

[haha]

OK.... I can go on a limb and say that there will be cheaper places to live than the US for the next 200 years....

There ya go....

Burkina Faso is everyone's ace in the hole.

Ha

 

[kcowan]

I guess I would say: What is the point of moving in the first place? If it is to retire before you were capable in the US, then you might have to make lots of compromises. But if you got 10-15 years of luxury living, what is the problem? Finally pay the price!

 

[Lancelot]

^ For me the lower cost of living abroad was a side benefit. My main reason for relocating was a love of travel and the expat experience. By nature I LBYM so moving back to the US is never a problem. Compared with Thailand cars, electronic devices and grain feed beef are all cheaper in the US.

 

[BunsGettingFirm]

A hypothetical situation, A person REed in a cheaper cost of living country. That person has enough money to live a quality life at the cheaper destination.

Now something happened (Exchange rate turned worst, VISA, tax, health, etc.), that person is forced to return to original country. But now the challenges start, the money which was sufficient in the cheaper country, is not sufficient, (WR is much north of 4%). Most skills are outdated so getting a good paying job is difficult. Some may find difficult to get health insurance. Leaving family behind in some cases.

So how to prepare for this situation, should have enough to RE in your original country only then retire in a cheaper country and live like king?

I am assuming you have sufficiently planned monthly cash flow and capital preservation and appreciation to retire in an OK but not spectacular style in the U.S. but you are only using the lower cost to upgrade your lifestyle, then let's take each of the reason you listed to see if returning to the U.S. makes sense.

If the exchange rate turned worse, then how does returning to the U.S. help? If you find life already a hard scrabble in a super cheap place like SE Asia where a bowl of pho can be had for $1.50, then how does returning to the land of $7.26 McDonald's meals help?

Tax? What do you mean? It's one word. What kind of tax would cause a person to have to return to the U.S.?

Health? Does this mean a health condition that can only be helped by living in the U.S., or does this mean that one can only afford to get quality health care in the States? One, I am not personally familiar with a particular condition that can only be ameliorated by living in the U.S. Two, I thought the Kiderlis have put plenty of info on their site about the quality and affordability of medical care available outside of the U.S. to obviate the need to ask this kind of question.

The only reason that seems plausible is if the country of your first choice drastically changes visa requirements. Then I assume you can always fall back on the countries of your second and third choice. Not ideal, but I don't see it coming down to the false dichotomy of retiring overseas or returning with tail between one's legs to the U.S.

 

[arebelspy]

I'm guessing tax means taxes. Meaning taxes in that other country raise enough that you can't afford to live there any more. That only makes sense if the tax is so high it costs more to live there than in the US.

And exchange rate worsening is possible, but it'd have to get so worse as to the cost of living being more in that other country than in the US.

Both implausible, but not impossible.

 

[ItDontMeanAThing]

A strange question in a way....

Let's change it to.... the market crashes over a 10 year period and you can see the writing on the wall that your portfolio will not make it...

But, to answer your question..... move to a different cheap country...

I guess this is strange since I am not sure how better to put this. Market crash (or meteor strike...) is something which is always a non zero probability. I guess by this logic one should work till not physically able to continue. I guess if one has 10-15 yrs of good retirement at relatively early age what else one can want.

I don't think it's a strange question. To me you were asking one of two things, maybe both: 1) what additional threats to running low on money come from being an expat, and 2) what are those threats. Both are meaningful questions IMHO.