For retirees, the average monthly Social Security check is about $1,228, according to the Social Security Administration. That might pay the rent for one room in a shared house in San Francisco or half the monthly rent for an apartment in New York City.
Or, it could foot the entire bill for your retirement somewhere by the beach in a Latin American country like Panama, Belize or Uruguay (possibly leaving you as much as $200/month to spare). That’s according to Kathleen Peddicord, founder and publisher of the Live and Invest Overseas publishing group.
“You can live way, way cheaper [and] enjoy a comfortable retirement for much less of a budget,” she tells us, in the accompanying video.
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And the numbers indicate a growing swath of American retirees is indeed choosing to live this way. The number of Americans receiving social security checks in South America has increased 48% from 2005 to 2012, according to the SSA. The number has risen 25% during that time in Central America and the Caribbean.
Peddicord says there is “no question” that America’s new Sun Belt for retirees is abroad, in Latin America.
What about the downsides, though? Political risk and worries about safety come to mind in countries with a history of drug violence and conflict, for example.
Peddicord, who lives in Panama City and has been writing about retirement trends for 30 years, understands those concerns. She notes a perception gap, though, when it comes to the countries she recommends retiring to, all of which she vets for safety and stability.
“It’s because you know something from the past: Historically, Colombia was unsafe [and] historically it had a very big deal drug problem,” she says, adding that Colombian drug lord Pablo Escobar and former Panamanian dictator Manuel Noriega were real guys reflecting countries with real problems. “But it’s the past -- that’s the thing to recognize. It’s 20-plus years later … and these are different places today.”
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And Peddicord says that while stories about Americans retiring to Panama, Costa Rica and Mexico have been around for awhile, there are a few places on her list not getting a lot of play. She identifies Colombia (“a really good choice nobody is talking about yet”) and Uruguay (“especially if you want a relaxed, peaceful lifestyle in Latin America” but with a “very European feel”) as the next "new Sun Belt" hot spots.
And while we're on hot spots, the ability to communicate with family and friends via Skype and Apple's FaceTime have made far-flung, adventurous retirement destinations all feel a little bit closer to home.