Tropical Beach Retirement

[Lifestyle Deflation]

I've recently bought a house to raise my kids in... My FIRE date is approximately ~15-20 years from now. I'm 30 and planning on retiring by 50 with ~1.5-2 million depending on markets.

Once the kids are raised, I don't see any reason why we shouldn't retire to a tropical beach. Obviously, attractive places today won't be the same places as we suggest 20 years from now, but I'd like some advice for the lifestyle we could expect in a beach locale as retirees with an average MMM type retirement stash. Outside of the US, of course.

[dude]

I was in Puerto Viejo, Costa Rica (Caribbean side) 2 years ago. The hotel where we stayed was owned by a Canadian ex-pat who now lives down there full-time running the hotel.  Over dinner, I asked him, "How much does it take to live comfortably down here?"  He smiled and said, "I live like a king down here for $35K a year."  I said, "Like a king?"  He emphasized, "Like a king."  Needless to say, my interest was piqued.  Met another guy down there, a Boeing retiree from Seattle, who retired there.  Met him at the local watering hole every night where he'd hang out with a few other ex-pats and the bar's owner, an Oklahoman, and got to chatting about it.  He said he'd looked at both Mexico and Costa Rica, but decided on Costa Rica for the medical care.  Said it's excellent and cheap down there.  Good surfing and fishing down there.  No hurricanes (too close to the equator), but it's jungle hot and they do have a significant rainy season.  Also, lots of venomous snakes.

[Retired To Win]

If you have any interest at all in either snorkeling or scuba diving, Bonaire is the place for you.  Also Curacao, but not as ideal.
On those islands, the coral reef is right -- immediately -- off the shore.  No boat required.  Spectacular coral reefs.  Outside the hurricane belt.  A skip and a jump from South America.  Part of the European Common Market. (yes!)  Dutch, English and Spanish languages all welcome.

[Retire-Canada]

I've spent 1-3 months most winters in Baja Mexico over the last couple decades and it's great to get away from Canadian winters. The cost if you care to control it is very modest. You can park an RV a lot of spots for free or a few dollars a day. Food is reasonable and if you like kayaking, surfing, kiteboarding, fishing, motorcycles, etc.... there is lots of low cost fun to be had.

I plan to spend more time down south as I FIRE, but I'll be home in Canada for 6 months a year. That gets me my health care and I really like where I live during the summer!

-- Vik

[spokey doke]

I've recently bought a house to raise my kids in... My FIRE date is approximately ~15-20 years from now. I'm 30 and planning on retiring by 50 with ~1.5-2 million depending on markets.

Once the kids are raised, I don't see any reason why we shouldn't retire to a tropical beach. Obviously, attractive places today won't be the same places as we suggest 20 years from now, but I'd like some advice for the lifestyle we could expect in a beach locale as retirees with an average MMM type retirement stash. Outside of the US, of course.

I was looking at real estate in Costa Rica (mostly SW and NW coast) and it didn't seem to be THAT much of a bargain (coming from a low COLA in the US)

[Capsu78]

I found these folks to be the go to guide for international retirement.  This link contains a pitch at the end; however they provide some good budgeting data to get your brain storming:

http://pro.internationalliving.com/SHORTCUT/EILVR4A2?email=david.flora%40comcast.net&a=12&o=125250&s=129109&u=3878545&l=121928&r=MC&g=0&h=true

I just returned from Ecuador to check things out and spoke to a couple of US expats who are spending extended periods there in retirement.  One retiree cautioned "...it's not for everybody"  and from my visit I can see why.  It takes a strong commitment.

Anyway, consider signing up for the newsletter if you are thinking about retiring out of the US. 

[pagoconcheques]

To retire in a tropical beach environment you really have to love both beaches and the tropics, along with all the attendant features. 

Tropics:  Generally hot and humid.  Altitude can level this out, but beaches are at sea level. 

Beach: Nice beaches are touristy.  While it's OK to be a tourist once in a while, living in an area with a constant flow of outsiders who like to party can get really old.  The trick is to live away from the touristy area, but this is difficult as those areas are where the beaches are nice.  Get outside of town and you inevitably find a rocky shoreline, nasty currents, or some other negative (which may not be immediately obvious).  If you find a nice area that is not touristy, prepare to spend lots of money. 

Frankly, unless the exchange rate and local prices make it so financially attractive that you can't say no, I think a tropical beach is one of the worst places to retire.  They look good i the pictures, but living there long-term is not so much fun.  Heat? Humidity? Tourists? No thanks. 

[YK-Phil]

To retire in a tropical beach environment you really have to love both beaches and the tropics, along with all the attendant features. 

Tropics:  Generally hot and humid.  Altitude can level this out, but beaches are at sea level. 

Beach: Nice beaches are touristy.  While it's OK to be a tourist once in a while, living in an area with a constant flow of outsiders who like to party can get really old.  The trick is to live away from the touristy area, but this is difficult as those areas are where the beaches are nice.  Get outside of town and you inevitably find a rocky shoreline, nasty currents, or some other negative (which may not be immediately obvious).  If you find a nice area that is not touristy, prepare to spend lots of money. 

Frankly, unless the exchange rate and local prices make it so financially attractive that you can't say no, I think a tropical beach is one of the worst places to retire.  They look good i the pictures, but living there long-term is not so much fun.  Heat? Humidity? Tourists? No thanks.

+1
Add to that: would you spend the rest of your life -and invest a lot of your capital in overseas real estate, in one spot, as paradise-like as it seems? I have friends who chose that option, and they regretted it after a couple of years. Personally, I plan to keep a pied-a-terre in my home country (close to my children, family, and friends) and spend 6-8 months here, but rent an apartment or house 4-6 months abroad in the winter, each year in a different country, and do some slow travel.

[Gone Fishing]

I second the renting, not buying, comment.  This allows you to "test" the area and move on easily and quickly if desired.   

If it were me, I'd go for a place where I could do lots of gardening, fishing/shellfishing, hiking, etc.  I never seem to tire of these activities and would enjoy the variety of the tropics vs temperate.  Quality social interaction would also be near the top of my list.

One thing to keep in mind is that the least expensive areas are probably more remote which comes with some issues.  It was a sample of one, but the expats we talked to in Golfito, Costa Rica had a hard time buying the things they were used to (bed linens for example) and took long bus rides to access shopping.
     

[teacherwithamustache]

The secret to buying in Central America/Mexico is to rent a house for at least 6 months and make sure you like it.  Then once you like the locale then you put word out that you are interested in buying a house and wait for a local to sell their house.  The price gouging happens when a local big wig or expat triples the price on a deal and tries to sell it to a retiree.

Keep a home base in US and spend time abroad for 6-10 weeks twice a year.  Rent a house and attempt to emerge yourself in the local culture/traditions.

[Jon_Snow]

Our family has had a place in the Baja for over 25 years. As my parents age, they find the "quirks" of Mexico less and less desirable and they go down less often. Of course, I intend to take up the slack and definitely stay down there for many months of the year - partly because it is truly amazing place, and partly because I really get sick of cold, wet, gray PNW winters.

Now, when my parents bought 25 years ago, just before the Los Cabos area took-off as a tourist destination, prices were dirt cheap. The property prices have probably quadrupled since then.

I've been to many tropical places over the course of my life - from what I've experienced the climate of the Baja cannot be matched. A short drive away from the tourist centres will give you endless miles of pristine, deserted beaches. And if you "do what the locals do", it can still be quite cheap to live down there. My wife and I love it.

For us, we prefer to have a tropical "home" versus travelling to a different spot every year...much cheaper for us this way, and over the years we have come to understand the Baja in a way that we would not if we were infrequent visitors. And we have a developed some great friendships with some local Mexican people too.

[Cookie78]

+1
Add to that: would you spend the rest of your life -and invest a lot of your capital in overseas real estate, in one spot, as paradise-like as it seems? I have friends who chose that option, and they regretted it after a couple of years. Personally, I plan to keep a pied-a-terre in my home country (close to my children, family, and friends) and spend 6-8 months here, but rent an apartment or house 4-6 months abroad in the winter, each year in a different country, and do some slow travel.

+1

I plan to travel this way for awhile. Then when I'm ready to settle in one place I'll have a much better idea of where I want to be. And even then, it might be a better option just to rent.

[mathlete]

How old are your kids?

Something to keep in mind is that despite everyone's best efforts and intentions, kids aren't always ready to spread their wings and fly once they turn 18.

I'm 26 and many of my friends are still at least somewhat dependent on parents or other family. They all have jobs. One has a 4 year degree, and another has a trade certification. Still though, with the equities, job, and housing market all crashing at the same time a few years back, and with stagnating wages, it can be tough for young people to make ends meet when they're just starting out.

I guess what I'm saying is that you might end up with kids who need you for longer than you're expecting.

[Retired To Win]

Something to keep in mind is that despite everyone's best efforts and intentions, kids aren't always ready to spread their wings and fly once they turn 18.

I'm 26 and many of my friends are still at least somewhat dependent on parents or other family. They all have jobs. One has a 4 year degree, and another has a trade certification. Still though, with the equities, job, and housing market all crashing at the same time a few years back, and with stagnating wages, it can be tough for young people to make ends meet when they're just starting out.

I guess what I'm saying is that you might end up with kids who need you for longer than you're expecting.

Waaaahhhh!!  :(

I must tell you.  To a guy like me -- who went on his own at 16, paid for his own college education, and never re-burdened his parents at just the time when they should have been focusing on providing for their own futures -- this just sounds like a serious case of whinypants.

If my intolerance is showing, so be it.  But implying to the poor guy that put up the original post that he should take into account in his retirement plans the possibility of having fully grown adult children still clinging to his wallet is just too much.

[Kris]

I found these folks to be the go to guide for international retirement.  This link contains a pitch at the end; however they provide some good budgeting data to get your brain storming:

http://pro.internationalliving.com/SHORTCUT/EILVR4A2?email=david.flora%40comcast.net&a=12&o=125250&s=129109&u=3878545&l=121928&r=MC&g=0&h=true

I just returned from Ecuador to check things out and spoke to a couple of US expats who are spending extended periods there in retirement.  One retiree cautioned "...it's not for everybody"  and from my visit I can see why.  It takes a strong commitment.

Capsu, where in Ecuador were you?  Can you explain what you mean by "It takes a strong commitment"?  I ask because Ecuador is on our list of potential places to retire, but I haven't been there yet (hoping to go this January).

[mathlete]

Waaaahhhh!!  :(

I must tell you.  To a guy like me -- who went on his own at 16, paid for his own college education, and never re-burdened his parents at just the time when they should have been focusing on providing for their own futures -- this just sounds like a serious case of whinypants.

If my intolerance is showing, so be it.  But implying to the poor guy that put up the original post that he should take into account in his retirement plans the possibility of having fully grown adult children still clinging to his wallet is just too much.

I was mostly independent by 19 or so. I'm just telling you what I see.

And with all due respect, the world is a very different place than it was when you were 16.

http://www.census.gov/hhes/www/income/data/historical/household/

Income for the bottom 40% of households peaked in 2000 and has declined throughout the early 2000s and late 2000s recessions. It has more or less stagnated since we came out of the great recession. Right now we're at about 1986 levels for the bottom 40%. I bring up the bottom 40% of households because young people tend to not be making a lot of money relative to everyone else.

http://www.usnews.com/news/articles/2013/10/23/charts-just-how-fast-has-college-tuition-grown

Meanwhile, college tuition costs and healthcare costs continue rising at a rate that is above inflation. Between 2003 and 2013, increases in tuition and healthcare outpaced the CPI by 52.8% and 16.4% respectively.

https://satyagraha.wordpress.com/2009/07/14/college-tuition-hyperinflation/

Inflation adjusted college tuition cost tripped between 1978 and 2008.

Despite a home price correction and historically low interest rates, the median age of first-time home buyers is currently 31. Unemployment just recently dropped below 6%, down from the double digits just a few years ago, and as I said above, the new jobs don't pay as much as the old ones.

Obviously OP has no legal obligation to his kids after they turn 18, but I'm just saying it might not be that easy to just cut them off completely. For all but a few exceptional kids, going out and independently starting their lives is kind of cost prohibitive right now.

[Capsu78]

I found these folks to be the go to guide for international retirement.  This link contains a pitch at the end; however they provide some good budgeting data to get your brain storming:

http://pro.internationalliving.com/SHORTCUT/EILVR4A2?email=david.flora%40comcast.net&a=12&o=125250&s=129109&u=3878545&l=121928&r=MC&g=0&h=true

I just returned from Ecuador to check things out and spoke to a couple of US expats who are spending extended periods there in retirement.  One retiree cautioned "...it's not for everybody"  and from my visit I can see why.  It takes a strong commitment.

Capsu, where in Ecuador were you?  Can you explain what you mean by "It takes a strong commitment"?  I ask because Ecuador is on our list of potential places to retire, but I haven't been there yet (hoping to go this January).

I went to Quito, solo,  pretty much on a whim- I wanted to go anywhere nicer than Chicago for a few days.  My wife said "Why don't you go to Florida?".  I said "been there, done that" and received an email from International Living talking about Ecuador being named the No 1 rated international retirement country for 2014.  (In all honestly, they seem to rotate around all the countries looking to expand the market of Ex Pat retiree's).  Anyway, I could get to Quito for $600 airfare vs Miami at $450 and found a B&B for $23/night (!). ( DW has already been gone 25 nights this year internationally and had no interest is going with me, so she was a bit shocked when I said I want to go to Ecuador- now that I am back she realizes that our next big trip will be to the Galapagos Islands).

Anyway, spoke to 4 different expats, both US and Canadian, who were all down there for at least 90 days and here were some of their comments:
Should be obvious, but a commitment to learning functional Spanish is a must- I was hindered in even the basics, like telling the taxi driver where I wanted to go.
Someone mentioned it above, but the one home owner I spoke to who was coming back to the US after 5 months said you have to be prepared to doing without some things you take for granted...he didn't elaborate but said a lot of unanticipated costs come up- labor is cheap but often materials are not.
Also, of the 4 "rando's" I spoke with, all of them were spry and appeared very healthy...3 of the 4 were in their 70's.  This is an extremely small sample, but my takeaway was you won't find unhealthy elders taking on this type of lifestyle.
I spent money 2 of the days to hire a driver. As a solo, I was hoping someone else would join us to defray the costs but no such luck.  Fortunately my driver spoke good English so we talked a lot about our different cultures etc.  The driving is best described as "controlled chaos" which is to be expected in many places on earth... however driving up to the volcanos, on winding 2 lane roads was a complete "white knuckle, glad I didn't have coffee this morning, where is the passenger side brake?" experience!  If you decide to "wait it out behind the logging truck in first gear for the next 5,000 ft climb, OK, but the cars and trucks behind you won't! 

Finally, met one guy who asked me what I did for a living and I tested my MMM "Pretired" title out on him.  He said "I am just the opposite from you- in his 70's, just separated from his 2nd wife who took it out on him financially and running out of/ living off his investments.  Was driving to Chile from NA for a job someone said they could get him.  His early 2000 vehicle transmission plant was damaged avoiding horses in Mexico and his gearbox case cracked and gave out coming up a big mountain pass near Quito.  Car manufacturer no longer in business and 1 repair guy in the whole country willing to look at it- and he thinks its a lost cause... So the guy is hoping to get his car working again in about a month, is stuck a thousand miles from where he was supposed to be and he needs a car when he gets there.   Fortunately, the guy has been all around the world and spoke 6 languages, so he knows how to operate in an international setting...but I felt bad for the spot the guy was in. 

So Kris, I can't add much more as I didn't get out to the main expat communities but they have at least 3 of them- one on the Pacific Coast, one in the mountains and the largest Cuenca down to the south with 5- 7,000 US expats living there.  If you Google for International Living I think you can drill down to some good information.

 

[jzb11]

 The challenges of south america are that:

1.) Poor Infrastructure
2.) High crime/low safety
3.) Goods can be more expensive than the USA (food and labor are not)
4.) Language - you'll have to learn
5.) Social Life - Can be isolating/challenging if you don't have a community of expats.

I live in Brazil for my job right now. It is a tropical area with an industrial base nearby. I am close to a lot of beaches and have opportunity to travel to other places as well.

It is paradise in the coconut/tropical beach kind of sense. It is also a miserable bureaucratic hell where things are broken, unsafe, expensive, and the little comforts are often missing.

Could I retire here some day? Maybe. My Portuguese is improving and the beach life is great. Although I miss my friends, and I miss being in a calm, orderly, comfortable, efficient and effective society.

When you live in a country in Brazil, you see how the little things matter, and how they add up/compound. I.E. good public education, good roads, a society that is orderly/polite/follow the rules for the most part. etc

[Retire-Canada]

No need to buy property somewhere tropical. Just go and rent. Enjoy as long as you like and be free to switch locations or go back home when you are feeling it.

You spent all kinds of time/effort to achieve financial independence you might as well enjoy geographical independence as well. ;)

I love the Baja, but I don't want to be tied to one particular spot in it for decades.

-- Vik

[dcheesi]

To retire in a tropical beach environment you really have to love both beaches and the tropics, along with all the attendant features. 

Tropics:  Generally hot and humid.  Altitude can level this out, but beaches are at sea level. 

Beach: Nice beaches are touristy.  While it's OK to be a tourist once in a while, living in an area with a constant flow of outsiders who like to party can get really old.  The trick is to live away from the touristy area, but this is difficult as those areas are where the beaches are nice.  Get outside of town and you inevitably find a rocky shoreline, nasty currents, or some other negative (which may not be immediately obvious).  If you find a nice area that is not touristy, prepare to spend lots of money. 

Frankly, unless the exchange rate and local prices make it so financially attractive that you can't say no, I think a tropical beach is one of the worst places to retire.  They look good i the pictures, but living there long-term is not so much fun.  Heat? Humidity? Tourists? No thanks.

+1
Add to that: would you spend the rest of your life -and invest a lot of your capital in overseas real estate, in one spot, as paradise-like as it seems? I have friends who chose that option, and they regretted it after a couple of years. Personally, I plan to keep a pied-a-terre in my home country (close to my children, family, and friends) and spend 6-8 months here, but rent an apartment or house 4-6 months abroad in the winter, each year in a different country, and do some slow travel.

Yeah, my brother "retired" to a tropical island ...only to come back a few years later. He and his wife got tired of the humidity, lack of infrastructure (it was a less-developed island, so few tourists, but few amenities either), etc.

[deborah]

I thought you had tropics in the mainland US. Here in Australia a lot of people retire to Port Douglas, Magnetic Island, Cairns, Townsville (all on or near the Great Barrier Reef - and Townsville and Cairns are the 13th and 14th most populated cities in Australia if you want a bit of infrastructure)... definitely tropical - and if you really want to get away from it all, our entire northern coastline is very sparsely populated.

[Kris]

I found these folks to be the go to guide for international retirement.  This link contains a pitch at the end; however they provide some good budgeting data to get your brain storming:

http://pro.internationalliving.com/SHORTCUT/EILVR4A2?email=david.flora%40comcast.net&a=12&o=125250&s=129109&u=3878545&l=121928&r=MC&g=0&h=true

I just returned from Ecuador to check things out and spoke to a couple of US expats who are spending extended periods there in retirement.  One retiree cautioned "...it's not for everybody"  and from my visit I can see why.  It takes a strong commitment.

Capsu, where in Ecuador were you?  Can you explain what you mean by "It takes a strong commitment"?  I ask because Ecuador is on our list of potential places to retire, but I haven't been there yet (hoping to go this January).

I went to Quito, solo,  pretty much on a whim- I wanted to go anywhere nicer than Chicago for a few days.  My wife said "Why don't you go to Florida?".  I said "been there, done that" and received an email from International Living talking about Ecuador being named the No 1 rated international retirement country for 2014.  (In all honestly, they seem to rotate around all the countries looking to expand the market of Ex Pat retiree's).  Anyway, I could get to Quito for $600 airfare vs Miami at $450 and found a B&B for $23/night (!). ( DW has already been gone 25 nights this year internationally and had no interest is going with me, so she was a bit shocked when I said I want to go to Ecuador- now that I am back she realizes that our next big trip will be to the Galapagos Islands).

Anyway, spoke to 4 different expats, both US and Canadian, who were all down there for at least 90 days and here were some of their comments:
Should be obvious, but a commitment to learning functional Spanish is a must- I was hindered in even the basics, like telling the taxi driver where I wanted to go.
Someone mentioned it above, but the one home owner I spoke to who was coming back to the US after 5 months said you have to be prepared to doing without some things you take for granted...he didn't elaborate but said a lot of unanticipated costs come up- labor is cheap but often materials are not.
Also, of the 4 "rando's" I spoke with, all of them were spry and appeared very healthy...3 of the 4 were in their 70's.  This is an extremely small sample, but my takeaway was you won't find unhealthy elders taking on this type of lifestyle.
I spent money 2 of the days to hire a driver. As a solo, I was hoping someone else would join us to defray the costs but no such luck.  Fortunately my driver spoke good English so we talked a lot about our different cultures etc.  The driving is best described as "controlled chaos" which is to be expected in many places on earth... however driving up to the volcanos, on winding 2 lane roads was a complete "white knuckle, glad I didn't have coffee this morning, where is the passenger side brake?" experience!  If you decide to "wait it out behind the logging truck in first gear for the next 5,000 ft climb, OK, but the cars and trucks behind you won't! 

Finally, met one guy who asked me what I did for a living and I tested my MMM "Pretired" title out on him.  He said "I am just the opposite from you- in his 70's, just separated from his 2nd wife who took it out on him financially and running out of/ living off his investments.  Was driving to Chile from NA for a job someone said they could get him.  His early 2000 vehicle transmission plant was damaged avoiding horses in Mexico and his gearbox case cracked and gave out coming up a big mountain pass near Quito.  Car manufacturer no longer in business and 1 repair guy in the whole country willing to look at it- and he thinks its a lost cause... So the guy is hoping to get his car working again in about a month, is stuck a thousand miles from where he was supposed to be and he needs a car when he gets there.   Fortunately, the guy has been all around the world and spoke 6 languages, so he knows how to operate in an international setting...but I felt bad for the spot the guy was in. 

So Kris, I can't add much more as I didn't get out to the main expat communities but they have at least 3 of them- one on the Pacific Coast, one in the mountains and the largest Cuenca down to the south with 5- 7,000 US expats living there.  If you Google for International Living I think you can drill down to some good information.

 

Thanks so much for the lengthy reply!!!   I really appreciate it.  I actually have been following International Living for a while now, so I know a lot of what they have to say about it (and I know what you mean about their choices of "Best Country" -- they have a lot of good info but of course they are out to make money from their readers). 

Luckily, a lot of what you said won't affect us too much, at least not directly.  I speak Spanish, we aren't planning on buying property, and we want to be car-free.  But it is really helpful to hear what random expats have to say.  It's a good counterpoint to IL. 

[Retired To Win]

I thought you had tropics in the mainland US...

That would be South Florida, south of Palm Beach.  Very urbanized , crowded, hectic and expensive.  Not really what come to my mind when I hear the words "tropical beach."  Technically, it is.  But it's not really comparable to a tropical island.  Not even the vaunted Florida Keys.

[MMMaybe]

Having lived in a few tropical and developing places, I would definitely suggest that you rent first. Its not always easy to sell your property quickly in those places.
Over time, the challenges of daily living can wear you down. It can be hard to get things that you want reliably and life just moves at a snail like pace.

Plus sometimes, it just can get plain boring living in a holiday destination as you end up going to the same places over and over. It can be a very small world.
I would probably look for a cheaper place in your own country and do slow travel for parts of the year.

[MayDay]

My sister lives in Guatemala and before that, Mexico. 

One ing that absolutely exhausts her is the food stuff.  She has to be insanely careful about what she eats.  She has had a ton of stomach problems as a result of either infections or parasites.  She can't ever just go have a drink of water from a tap.  The doctors she sees when she has a stomach complaint have basically just given her an antibiotic or parasite med without figuring out exactly what the problem is.  It eventually caused serious gut issues and she couldn't eat dairy or gluten (she has since recovered from that). 

She loves living there and is fluent in Spanish, but it is hard.  She gets so sick of having to be careful all the time.  Her coworkers got kidnapped by a drug cartel (released unharmed thankfully, after their car was "borrowed".  She has been robbed multiple times.  Her friend was mugged in the nicest/safest neighborhood of DF.  She has to be constantly on guard about all these safety things plus all the food things. 

If her guard slips, which it always eventually will, boom, her purse is gone from the back of the rental car while she is paying at the airport.  And she calls and complains because she knows it was a rental company employee, and the rental company doesn't care.  But she has to deal with the whole mess, trying to call US banks, get new cards shipped (but oh!  Don't send through mexican mail, you must fedex airmail for 50$). 

[paddedhat]

Waaaahhhh!!  :(

I must tell you.  To a guy like me -- who went on his own at 16, paid for his own college education, and never re-burdened his parents at just the time when they should have been focusing on providing for their own futures -- this just sounds like a serious case of whinypants.

If my intolerance is showing, so be it.  But implying to the poor guy that put up the original post that he should take into account in his retirement plans the possibility of having fully grown adult children still clinging to his wallet is just too much.

I was mostly independent by 19 or so. I'm just telling you what I see.

And with all due respect, the world is a very different place than it was when you were 16.

http://www.census.gov/hhes/www/income/data/historical/household/

Income for the bottom 40% of households peaked in 2000 and has declined throughout the early 2000s and late 2000s recessions. It has more or less stagnated since we came out of the great recession. Right now we're at about 1986 levels for the bottom 40%. I bring up the bottom 40% of households because young people tend to not be making a lot of money relative to everyone else.

http://www.usnews.com/news/articles/2013/10/23/charts-just-how-fast-has-college-tuition-grown

Meanwhile, college tuition costs and healthcare costs continue rising at a rate that is above inflation. Between 2003 and 2013, increases in tuition and healthcare outpaced the CPI by 52.8% and 16.4% respectively.

https://satyagraha.wordpress.com/2009/07/14/college-tuition-hyperinflation/

Inflation adjusted college tuition cost tripped between 1978 and 2008.

Despite a home price correction and historically low interest rates, the median age of first-time home buyers is currently 31. Unemployment just recently dropped below 6%, down from the double digits just a few years ago, and as I said above, the new jobs don't pay as much as the old ones.

Obviously OP has no legal obligation to his kids after they turn 18, but I'm just saying it might not be that easy to just cut them off completely. For all but a few exceptional kids, going out and independently starting their lives is kind of cost prohibitive right now.

Mathlete, kudos to an excellent post.  I'm fifty one and FIRE for two years now. I have two kids in their early twenties, and somehow developed a completely different outlook on the situation, compared to the poster you responded to. It really isn't hard to see that I became an independent adult, at seventeen, in a completely different world. I made a very decent salary throughout my different careers, got a free education as a Union tradesmen, and started two successful small businesses that were self-financed. My history would be pretty hard to replicate thirty years later. I insured my first vehicle, as an independent adult, for less than $300 a year. My kid got quotes of $2000. My first year of college ran less than $3K, my two kids finished up their four years at universities for a bit less than $80K each. My first apartment was $285 a month, my daughter can't find anything but studios for under $850, and they want 1-1/2 to 2 months for security.  And the list goes on. I clearly saw the differences in their paths and mine, even before they left high school. My step dad was a real hard assed bastard who believed the delusion that everybody should start with nothing, since he did. I saw it differently. I paid for the kids college costs, and made sure that they had decent vehicles. I gave them the cash to take that next step, when it was obvious that they weren't going to get the chance on the $7/hr jobs they had, in the university towns they were living in.  The oldest is now twenty five, and a well paid, fiercely independent, oil industry engineer. He stayed in contact with a lot of his high school buddies. I occasionally ask how everybody is doing? My take on it is that the ones that were sent out in the world with no back-up, are the ones without bachelors degrees, or even a successful run in community college,  still living in the same economically depressed area they grew up in, and are the ones making $10-12/hr driving dump trucks and working in distribution warehouses.  It isn't cheap, or easy, to help a child move on to successful adulthood, but IMHO, being a hard ass who has nothing but bitter, "back in the day" stories of how it was when I was seventeen, wouldn't of gotten my kids very far.

[dude]

No need to buy property somewhere tropical. Just go and rent. Enjoy as long as you like and be free to switch locations or go back home when you are feeling it.

You spent all kinds of time/effort to achieve financial independence you might as well enjoy geographical independence as well. ;)

I love the Baja, but I don't want to be tied to one particular spot in it for decades.

-- Vik

Agree. I've seen (modern) condos for rent in Cozumel for as little as $500/month -- why would you ever buy and deal with all the foreign transaction stuff when you can rent for so litte?

[mathlete]

Mathlete, kudos to an excellent post.  I'm fifty one and FIRE for two years now. I have two kids in their early twenties, and somehow developed a completely different outlook on the situation, compared to the poster you responded to. It really isn't hard to see that I became an independent adult, at seventeen, in a completely different world. I made a very decent salary throughout my different careers, got a free education as a Union tradesmen, and started two successful small businesses that were self-financed. My history would be pretty hard to replicate thirty years later. I insured my first vehicle, as an independent adult, for less than $300 a year. My kid got quotes of $2000. My first year of college ran less than $3K, my two kids finished up their four years at universities for a bit less than $80K each. My first apartment was $285 a month, my daughter can't find anything but studios for under $850, and they want 1-1/2 to 2 months for security.  And the list goes on. I clearly saw the differences in their paths and mine, even before they left high school. My step dad was a real hard assed bastard who believed the delusion that everybody should start with nothing, since he did. I saw it differently. I paid for the kids college costs, and made sure that they had decent vehicles. I gave them the cash to take that next step, when it was obvious that they weren't going to get the chance on the $7/hr jobs they had, in the university towns they were living in.  The oldest is now twenty five, and a well paid, fiercely independent, oil industry engineer. He stayed in contact with a lot of his high school buddies. I occasionally ask how everybody is doing? My take on it is that the ones that were sent out in the world with no back-up, are the ones without bachelors degrees, or even a successful run in community college,  still living in the same economically depressed area they grew up in, and are the ones making $10-12/hr driving dump trucks and working in distribution warehouses.  It isn't cheap, or easy, to help a child move on to successful adulthood, but IMHO, being a hard ass who has nothing but bitter, "back in the day" stories of how it was when I was seventeen, wouldn't of gotten my kids very far.

Yeah. I don't mean to say it is all doom and gloom or anything. I turned out okay so obviously it is possible for millennials to succeed. And we have a big advantage over previous generations in that we can flip on a computer or smart phone and learn about anything we want to in a matter of seconds. I just see a lot of people around my age or maybe a bit older who are making plans based on "once the kids are 18...", meanwhile a lot of my friends are in the rut that I describe and a lot of my baby-boomer co-workers are still helping to support their working children.

Anyway, didn't mean to derail the thread or anything, it's just something for parents to think about.

[pagoconcheques]

The challenges of south america are that:
.
.
Can be isolating/challenging if you don't have a community of expats.

Moving abroad to live a life centered around an ex-pat community sounds horrible to me.  Why would anyone even want to do that?  If you don't/can't like the locals enough to have them serve as your primary social network, why bother living there?

[frugalnacho]

The challenges of south america are that:
.
.
Can be isolating/challenging if you don't have a community of expats.

Moving abroad to live a life centered around an ex-pat community sounds horrible to me.  Why would anyone even want to do that?  If you don't/can't like the locals enough to have them serve as your primary social network, why bother living there?

Geography and weather?

[retired?]

No need to buy property somewhere tropical. Just go and rent. Enjoy as long as you like and be free to switch locations or go back home when you are feeling it.

You spent all kinds of time/effort to achieve financial independence you might as well enjoy geographical independence as well. ;)

I love the Baja, but I don't want to be tied to one particular spot in it for decades.

-- Vik

Ditto that.  And, allows you to easily choose a new locale every year if you want.  For comparison, I think of the all-inclusive places in Mexico where they tried to push time shares.  One was Mazatlan.  One was Huatulco.  Mazatlan now has zero nonstop flights from Houston and flights to both places are about 2x as when we toured the places.  The conclusion we reached was that there are too many places to see to commit to one place.

Another thing I wonder about is how long this will last?  Earliest for me would be about 11-12 years.  I expect the cost to rise as more Americans and Canadians keep doing this.  I think it will slowly become not such a great deal......at least for what Americans/Canadians would want to "live like a king".

[Capsu78]

The challenges of south america are that:
.
.
Can be isolating/challenging if you don't have a community of expats.

Moving abroad to live a life centered around an ex-pat community sounds horrible to me.  Why would anyone even want to do that?  If you don't/can't like the locals enough to have them serve as your primary social network, why bother living there?

Pro's of an expat community are similar to moving to a "little Italy" or "Chinatown"... You can take a break from emersion and have a chat in your native language, get a reference on a plumber or have some access to legal services.  The larger the community, the better the chance that a couple businesses catering to your tastes open up- say a pizza joint or a pub where you can get an NFL fix in.  If you want to manage a total emersion experience, fine, but you may have to solve some very basic problems that arise on your own.  An ex pat community means you may not have to reinvent the wheel for every situation that presents itself. 

[Retired To Win]

The challenges of south america are that:
.
.
Can be isolating/challenging if you don't have a community of expats.

Moving abroad to live a life centered around an ex-pat community sounds horrible to me.  Why would anyone even want to do that?  If you don't/can't like the locals enough to have them serve as your primary social network, why bother living there?

Natural attractions?  Significantly lower costs?  Preferred pace of life?

Anyway, it would seem to me that one could slide in and out of the ex-pat community.  We're not talking about buying a condo in a compound... are we?

[Retire-Canada]

Moving abroad to live a life centered around an ex-pat community sounds horrible to me.  Why would anyone even want to do that?  If you don't/can't like the locals enough to have them serve as your primary social network, why bother living there?

Why?

1. Climate
2. Low cost of living
3. You like the local ex-pat community
4. You like the locals, but want other folks to socialize with

-- Vik

[Kris]

Moving abroad to live a life centered around an ex-pat community sounds horrible to me.  Why would anyone even want to do that?  If you don't/can't like the locals enough to have them serve as your primary social network, why bother living there?

Why?

1. Climate
2. Low cost of living
3. You like the local ex-pat community
4. You like the locals, but want other folks to socialize with

-- Vik

This.  I have traveled extensively, as has my husband, and I have lived in other countries with no contact with my countrymen for years at a time.  I also speak Spanish.  But we are planning to retire somewhere in Central or South America, and we are indeed looking for a place with an ex-pat community.  Partly for all the reasons Vik cites, but also because we would actually like some people around who "know the ropes", at least at first, for issues we haven't encountered before in our more temporary stays (even two years feels temporary if you don't have a residency permit), like navigating health insurance, legal and tax issues, etc. 

[jzb11]

The challenges of south america are that:
.
.
Can be isolating/challenging if you don't have a community of expats.

Moving abroad to live a life centered around an ex-pat community sounds horrible to me.  Why would anyone even want to do that?  If you don't/can't like the locals enough to have them serve as your primary social network, why bother living there?

Because it's not so simple.

I speak as someone who has lived and worked in Brazil for two years. it was incredibly difficult to build a social circle/social life the first year I lived here. I live in an area where English is not common, and safety is a major concern. As a result my social options wwre severely restricted. Being a foreigner in another country and trying to meet people is not easy, unless you live in a city that is metropolitan/international/a popular tourist/business destination.

I struggled for a long time trying to meet other singles to hang out with. I have an expat friend who is English who has lived here for five years and has had a similar struggle.

Meanwhile, the company I am working at has several american expats with their families who all live in the same area. Are they missing out on local culture by not having brazilian friends? Absolutely! However, making Brazilian friends is not guaranteed, and doesn't work of they don't speak English, and you don't speak Portugues. Because they at least have an expat community, the spouses have things to do during the day, the kids go to school together and have friends, etc.

Also, it can be difficult breaking into pre defined social circles. Most people in their adult life are not looking for new friends. I mean are you hanging out in your city looking for foreigners to be friend and do life with? If you are, awesome, but you're an exception not the rule.

[2lazy2retire]

Waaaahhhh!!  :(

I must tell you.  To a guy like me -- who went on his own at 16, paid for his own college education, and never re-burdened his parents at just the time when they should have been focusing on providing for their own futures -- this just sounds like a serious case of whinypants.

If my intolerance is showing, so be it.  But implying to the poor guy that put up the original post that he should take into account in his retirement plans the possibility of having fully grown adult children still clinging to his wallet is just too much.

I was mostly independent by 19 or so. I'm just telling you what I see.

And with all due respect, the world is a very different place than it was when you were 16.

http://www.census.gov/hhes/www/income/data/historical/household/

Income for the bottom 40% of households peaked in 2000 and has declined throughout the early 2000s and late 2000s recessions. It has more or less stagnated since we came out of the great recession. Right now we're at about 1986 levels for the bottom 40%. I bring up the bottom 40% of households because young people tend to not be making a lot of money relative to everyone else.

http://www.usnews.com/news/articles/2013/10/23/charts-just-how-fast-has-college-tuition-grown

Meanwhile, college tuition costs and healthcare costs continue rising at a rate that is above inflation. Between 2003 and 2013, increases in tuition and healthcare outpaced the CPI by 52.8% and 16.4% respectively.

https://satyagraha.wordpress.com/2009/07/14/college-tuition-hyperinflation/

Inflation adjusted college tuition cost tripped between 1978 and 2008.

Despite a home price correction and historically low interest rates, the median age of first-time home buyers is currently 31. Unemployment just recently dropped below 6%, down from the double digits just a few years ago, and as I said above, the new jobs don't pay as much as the old ones.

Obviously OP has no legal obligation to his kids after they turn 18, but I'm just saying it might not be that easy to just cut them off completely. For all but a few exceptional kids, going out and independently starting their lives is kind of cost prohibitive right now.

Mathlete, kudos to an excellent post.  I'm fifty one and FIRE for two years now. I have two kids in their early twenties, and somehow developed a completely different outlook on the situation, compared to the poster you responded to. It really isn't hard to see that I became an independent adult, at seventeen, in a completely different world. I made a very decent salary throughout my different careers, got a free education as a Union tradesmen, and started two successful small businesses that were self-financed. My history would be pretty hard to replicate thirty years later. I insured my first vehicle, as an independent adult, for less than $300 a year. My kid got quotes of $2000. My first year of college ran less than $3K, my two kids finished up their four years at universities for a bit less than $80K each. My first apartment was $285 a month, my daughter can't find anything but studios for under $850, and they want 1-1/2 to 2 months for security.  And the list goes on. I clearly saw the differences in their paths and mine, even before they left high school. My step dad was a real hard assed bastard who believed the delusion that everybody should start with nothing, since he did. I saw it differently. I paid for the kids college costs, and made sure that they had decent vehicles. I gave them the cash to take that next step, when it was obvious that they weren't going to get the chance on the $7/hr jobs they had, in the university towns they were living in.  The oldest is now twenty five, and a well paid, fiercely independent, oil industry engineer. He stayed in contact with a lot of his high school buddies. I occasionally ask how everybody is doing? My take on it is that the ones that were sent out in the world with no back-up, are the ones without bachelors degrees, or even a successful run in community college,  still living in the same economically depressed area they grew up in, and are the ones making $10-12/hr driving dump trucks and working in distribution warehouses.  It isn't cheap, or easy, to help a child move on to successful adulthood, but IMHO, being a hard ass who has nothing but bitter, "back in the day" stories of how it was when I was seventeen, wouldn't of gotten my kids very far.

The way I look at it a 4 year college degree today has about the same value as a high school education in my day, I did not pay for my high school so my kids will not pay for college.

[Dicey]

Something to keep in mind is that despite everyone's best efforts and intentions, kids aren't always ready to spread their wings and fly once they turn 18.

I'm 26 and many of my friends are still at least somewhat dependent on parents or other family. They all have jobs. One has a 4 year degree, and another has a trade certification. Still though, with the equities, job, and housing market all crashing at the same time a few years back, and with stagnating wages, it can be tough for young people to make ends meet when they're just starting out.

I guess what I'm saying is that you might end up with kids who need you for longer than you're expecting.

Waaaahhhh!!  :(

I must tell you.  To a guy like me -- who went on his own at 16, paid for his own college education, and never re-burdened his parents at just the time when they should have been focusing on providing for their own futures -- this just sounds like a serious case of whinypants.

If my intolerance is showing, so be it.  But implying to the poor guy that put up the original post that he should take into account in his retirement plans the possibility of having fully grown adult children still clinging to his wallet is just too much.

What RTW said! Somebody please call the w-a-a-a-a-h-mbulance...

[SK Joyous]

Something to keep in mind is that despite everyone's best efforts and intentions, kids aren't always ready to spread their wings and fly once they turn 18.

I'm 26 and many of my friends are still at least somewhat dependent on parents or other family. They all have jobs. One has a 4 year degree, and another has a trade certification. Still though, with the equities, job, and housing market all crashing at the same time a few years back, and with stagnating wages, it can be tough for young people to make ends meet when they're just starting out.

I guess what I'm saying is that you might end up with kids who need you for longer than you're expecting.

Waaaahhhh!!  :(

I must tell you.  To a guy like me -- who went on his own at 16, paid for his own college education, and never re-burdened his parents at just the time when they should have been focusing on providing for their own futures -- this just sounds like a serious case of whinypants.

If my intolerance is showing, so be it.  But implying to the poor guy that put up the original post that he should take into account in his retirement plans the possibility of having fully grown adult children still clinging to his wallet is just too much.

What RTW said! Somebody please call the w-a-a-a-a-h-mbulance...

I suggest you read the well-thought-out and accurate posts by mathlete and paddedhat.  I am in the middle of these ages (40s) and can also clearly see that the environment in which a 60+ year old 'came into adulthood' is VASTLY different than what my kids have/are coming into.  Anyone who can't see that isn't paying attention.

[YK-Phil]

Something to keep in mind is that despite everyone's best efforts and intentions, kids aren't always ready to spread their wings and fly once they turn 18.

I'm 26 and many of my friends are still at least somewhat dependent on parents or other family. They all have jobs. One has a 4 year degree, and another has a trade certification. Still though, with the equities, job, and housing market all crashing at the same time a few years back, and with stagnating wages, it can be tough for young people to make ends meet when they're just starting out.

I guess what I'm saying is that you might end up with kids who need you for longer than you're expecting.

Waaaahhhh!!  :(

I must tell you.  To a guy like me -- who went on his own at 16, paid for his own college education, and never re-burdened his parents at just the time when they should have been focusing on providing for their own futures -- this just sounds like a serious case of whinypants.

If my intolerance is showing, so be it.  But implying to the poor guy that put up the original post that he should take into account in his retirement plans the possibility of having fully grown adult children still clinging to his wallet is just too much.

What RTW said! Somebody please call the w-a-a-a-a-h-mbulance...

I suggest you read the well-thought-out and accurate posts by mathlete and paddedhat.  I am in the middle of these ages (40s) and can also clearly see that the environment in which a 60+ year old 'came into adulthood' is VASTLY different than what my kids have/are coming into.  Anyone who can't see that isn't paying attention.

+1. Couldn't agree more.

[arebelspy]

MOD NOTES:  1) Please keep in mind forum rule #1.  2) Please try to stay on topic.  Cheers!

[Retired To Win]

Getting back on topic...

Anyone thinking about Puerto Rico as a place for tropical beach retirement?  It's U.S. territory, you know.

From what I saw in the U.S. Virgin Islands and Hawaii, it would cost too much to retire there. (I guess Nords would beg to differ.)  Even Guam.  But Saipan looked promising.  And Palau is very closely associated with the U.S. and even uses the American dollar and postal service!

Any feedback on any of this?

[Kris]

Getting back on topic...

Anyone thinking about Puerto Rico as a place for tropical beach retirement?  It's U.S. territory, you know.

From what I saw in the U.S. Virgin Islands and Hawaii, it would cost too much to retire there. (I guess Nords would beg to differ.)  Even Guam.  But Saipan looked promising.  And Palau is very closely associated with the U.S. and even uses the American dollar and postal service!

Any feedback on any of this?

We were for a while.  I think we may end up spending some time there eventually, but we're leaning toward Ecuador first.

[Capsu78]

Forgot to mention 2 other things Ecuador has going for it-  They too use USD and gas was $1.49 a gallon!

[Retired To Win]

... I'd like some advice for the lifestyle we could expect in a beach locale as retirees with an average MMM type retirement stash. Outside of the US, of course.

The answer is going to depend on the degree to which you are interested in living like a well-to-do local versus living like an American expat.  A condo on the beach or a beach house a few blocks in?  And so on...

[iamlindoro]

Colombia is probably top of my list right now (Medellín specifically), the Yucatán in Mexico after that, and then Ecuador is pretty high up there too.  I think we can live with a more bureaucracy and fewer conveniences, but in order to talk my SO into it we'll probably need at least decent internet and semi-reliable utilities.  Personally, I'm okay with having to do a little extra work to keep things reliable (cisterns and generators to cover brief spotty periods of water and power, etc).  Having a bit of room to roam wouldn't be too bad either, but is probably negotiable.

[Retired To Win]

No one has brought up Asian relocation possibilities.  I have met people -- a long time ago, though -- that lived like kings in Thailand for a relative pittance.  And what about the Philippines? Any other thoughts?

[iamlindoro]

No one has brought up Asian relocation possibilities.  I have met people -- a long time ago, though -- that lived like kings in Thailand for a relative pittance.  And what about the Philippines? Any other thoughts?

Definitely financially feasible, and potentially for less than a lot of Central and South American destinations.  I guess for me I would feel that transitioning into the local community would be easier in a western country.  That's not to say that I would ever be completely on the inside, but the hurdles to overcome regarding language, culture, and general worldview are at least lower between different European-settled countries.

This is not a statement about relative merit of western versus eastern culture, and certainly with enough effort the barriers between people can be overcome.  I just happen to think that a Central/South American country would be an easier transition for me personally.

Another idea that is tempting is some of the less expensive countries in Europe itself, such as Spain and Portugal, which can be close to as inexpensive as some of the others, and offer first-world stability and infrastructure.

[JamesAt15]

From what I saw in the U.S. Virgin Islands and Hawaii, it would cost too much to retire there. (I guess Nords would beg to differ.)  Even Guam.  But Saipan looked promising.  And Palau is very closely associated with the U.S. and even uses the American dollar and postal service!

Any feedback on any of this?

I just came back from a family vacation to Saipan. We live in Tokyo so it's a short flight.

You should really visit it yourself before making any decisions about if it would be a good place to retire to. Same with Guam. It crossed my mind while we were visiting, but overall I found the idea rather depressing. Once you leave the hotels and the DFS Galleria area, storefronts are weather-beaten with many closures. The vibe I got was, small pacific island with little to do, totally dependent on tourists visiting from Japan (in major decline), Korea and China (in much greater numbers in recent years). Not sure what cost of living would be like. Gas was $4.05/gallon, I noticed. I would guess you could buy or rent a place away from the major tourist areas for quite cheap, but that's where the nicest beaches are. I don't know if there is surfing - waves were low to non-existent at the beaches we visited.

Other items to consider - is there decent hospital/medical care available on the island? And how often would you want to leave/is travel to the mainland US or other areas you would want to visit convenient? A taxi driver mentioned that there used to be direct flights to the Philippines that he used to visit family, but they were cut and now he has to transfer overnight in Tokyo, or transfer in Guam. (Guam didn't sound too bad so I am not sure why he seemed to prefer the Tokyo route.) Might not be a big deal right now, but if the tourist trade / economy is contracting, flights in and out of Saipan will probably continue to be cut.

[patrickza]

I'm a huge beach and ocean lover, even with an irrational fear of sharks! My plan is to get a comfortable, reliable, cheap (pick any two ;)) boat and explore all the beaches post retirement!

I think I would get bored staying in one place for too long. The caribbean in winter and med in summer sounds like a great circiut to me. Nature in the caribean followed by culture in the med sounds perfect to me.