Latin America attracts US retirees AARP VIVA
Latin America attracts US retirees — AARP VIVA
They also offer health care options, more political stability than in the past and perks geared to retirees, she says. And many retirees who move to Latin America keep their Medicare coverage, then head home to use it if they suffer a serious illness or need an expensive medical procedure.
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“But as good as the medical community is here,” he says, “I would still be more comfortable using my Medicare and medical facilities in San Diego if something more serious came up, such as cancer.”
Other retirees buy local health insurance or international insurance plans. Hospitals in Latin America couldn’t compete with those in the United States before, but now they are often just as good and a lot less expensive, Peddicord says.
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U.S. retirees also continue to be eligible for Social Security benefits, and many have their checks directly deposited in foreign banks. Among the Caribbean and Central American countries, the Dominican Republic and Costa Rica have the most beneficiaries, and in South America, Colombia and Argentina have the most, according to the Social Security Administration. Latin American countries also offer perks. In Ecuador, for instance, you can import household goods duty-free, and Panama allows you to import an unlimited amount of used goods and a car duty-free. Mexico and many other nations offer retirees discounts on everything from airfares to utilities. Mexico also provides discounts to expatriates on medicine and medical care as well as job training and placement services through its Instituto Nacional de las Personas Adultas Mayores.
U.S. expatriates in all countries must file yearly tax returns, but the IRS allows retirees living overseas to exempt the first $92,900 in earned income from U.S. taxes. And while some countries, including Mexico, require retirees to file tax returns, others such as Nicaragua and Panama don’t tax out-of-country income.
Many retirees still wonder if, despite the perks, Latin American countries are safe. Peddicord says that, overall, they are. But check the U.S. State Department travel advisories before making your decision.
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After Chile overhauled its pension system in the 1980s, many of its neighbors followed suit. But that experiment — which abandoned government–run retirement systems for highly regulated 401(k)-type plans — failed to increase the number of Latin Americans with pensions. In fact, fewer than half of the workers in countries that followed Chile’s lead are covered by pensions, according to a recent report by Cotlear.
Some nations, including Mexico, offer their pensionless older citizens modest cash payments, but many older Latinos continue to work to support themselves. More than 40 percent of Latin America’s over-60 population is still in the workforce, according to the . Many in Latin America also are kept out of poverty by remittances from family members abroad.
To combat Latin America’s aging revolution, the World Bank report recommends building stronger health systems, increasing the retirement age, finding better ways to steer people into pensions and creating more jobs for women. Women, Cotlear says, are less likely to be in the workforce and therefore have no access to workplace pensions.
But addressing the needs of an aging population may not be a priority for Latin leaders, who are facing more immediate problems, says Riordan Roett, director of the Latin American Studies Program at The Johns Hopkins University Paul H. Nitze School of Advanced International Studies. “They don’t have the money [and] they don’t have the political will to do anything now,” said Roett at a recent conference on aging in Latin America cosponsored by AARP and the Rand Corporation. “I see a crisis policymakers aren’t focusing on much.”
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Retiring in Latin America
Facing an ' aging revolution'
Mexico continues to draw the largest number of U.S. retirees, but other Latin American nations are becoming increasingly popular. “They’re nearby, sunny and cheap,” says Kathleen Peddicord, author of How to Retire Overseas.They also offer health care options, more political stability than in the past and perks geared to retirees, she says. And many retirees who move to Latin America keep their Medicare coverage, then head home to use it if they suffer a serious illness or need an expensive medical procedure.
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Related
Don Robinson, 66, is a retired realtor from San Diego who now lives in the Mexican city of La Paz, the seaside capital of Baja California Sur. He pays less in Mexico for his prescription drugs and happily visits local doctors for routine medical care.“But as good as the medical community is here,” he says, “I would still be more comfortable using my Medicare and medical facilities in San Diego if something more serious came up, such as cancer.”
Other retirees buy local health insurance or international insurance plans. Hospitals in Latin America couldn’t compete with those in the United States before, but now they are often just as good and a lot less expensive, Peddicord says.
Next:
U.S. retirees also continue to be eligible for Social Security benefits, and many have their checks directly deposited in foreign banks. Among the Caribbean and Central American countries, the Dominican Republic and Costa Rica have the most beneficiaries, and in South America, Colombia and Argentina have the most, according to the Social Security Administration. Latin American countries also offer perks. In Ecuador, for instance, you can import household goods duty-free, and Panama allows you to import an unlimited amount of used goods and a car duty-free. Mexico and many other nations offer retirees discounts on everything from airfares to utilities. Mexico also provides discounts to expatriates on medicine and medical care as well as job training and placement services through its Instituto Nacional de las Personas Adultas Mayores.
U.S. expatriates in all countries must file yearly tax returns, but the IRS allows retirees living overseas to exempt the first $92,900 in earned income from U.S. taxes. And while some countries, including Mexico, require retirees to file tax returns, others such as Nicaragua and Panama don’t tax out-of-country income.
Many retirees still wonder if, despite the perks, Latin American countries are safe. Peddicord says that, overall, they are. But check the U.S. State Department travel advisories before making your decision.
Next:
Study Population Aging — Is Latin America Ready
With birthrates falling and people living longer, Latin America is facing an “aging revolution” that could find its leaders woefully unprepared, says World Bank economist Daniel Cotlear. The populations of Argentina, Chile, Cuba and Uruguay are aging the fastest, but the rest of Latin America isn’t far behind, says the native of Peru. And despite their burgeoning numbers, he adds, too many Latin Americans have no retirement plans.After Chile overhauled its pension system in the 1980s, many of its neighbors followed suit. But that experiment — which abandoned government–run retirement systems for highly regulated 401(k)-type plans — failed to increase the number of Latin Americans with pensions. In fact, fewer than half of the workers in countries that followed Chile’s lead are covered by pensions, according to a recent report by Cotlear.
Some nations, including Mexico, offer their pensionless older citizens modest cash payments, but many older Latinos continue to work to support themselves. More than 40 percent of Latin America’s over-60 population is still in the workforce, according to the . Many in Latin America also are kept out of poverty by remittances from family members abroad.
To combat Latin America’s aging revolution, the World Bank report recommends building stronger health systems, increasing the retirement age, finding better ways to steer people into pensions and creating more jobs for women. Women, Cotlear says, are less likely to be in the workforce and therefore have no access to workplace pensions.
But addressing the needs of an aging population may not be a priority for Latin leaders, who are facing more immediate problems, says Riordan Roett, director of the Latin American Studies Program at The Johns Hopkins University Paul H. Nitze School of Advanced International Studies. “They don’t have the money [and] they don’t have the political will to do anything now,” said Roett at a recent conference on aging in Latin America cosponsored by AARP and the Rand Corporation. “I see a crisis policymakers aren’t focusing on much.”
Cancel You are leaving AARP.org and going to the website of our trusted provider. The provider’s terms, conditions and policies apply. Please return to AARP.org to learn more about other benefits. Your email address is now confirmed. You'll start receiving the latest news, benefits, events, and programs related to AARP's mission to empower people to choose how they live as they age. You can also by updating your account at anytime. You will be asked to register or log in. Cancel Offer Details Disclosures