10 Signs You Are Not Financially OK to Retire

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By Amy Fontinelle | Investopedia

Being ready to retire means more than being ready to stop waking up at 6:00 a.m. to put in long hours at a job you’re not thrilled about. If it were that simple, most of us would retire at 25. What it really takes to retire is a solid grasp of your budget, a carefully considered investment and spending plan for your life savings, debtthat’s under control and a plan you’re excited about for how you’ll spend your days. With that in mind, here are 10 signs you might not be ready to retire yet.

1. You’re Struggling to Pay Your Bills

Randall Greene, a financial advisor and CEO of Greene Financial Management in Altadena, Calif., recommends that his retirement-minded clients plan to live off about 75% of their pre-retirement income in order to maintain a similar lifestyle. The 75% figure is a general rule that assumes reductions in outlays, like no longer contributing to a retirement plan or account, no longer saving for a child’s college education and no longer having job-related expenses such as commuting and a work wardrobe.

However, that figure might be lower or higher depending on the taxes you’ll pay on your retirement account withdrawals and how you plan to spend your retirement.

“If someone plans to travel through Europe and take luxury cruises, that person is going to need significantly more than someone whose hobbies include reading and gardening,” Greene says.

“If you are struggling to pay your bills now, how will you pay your bills if you only receive 75% of what you currently make?” he says. “While a lot of people tend to spend less as they get older, they need to take into account that some other expenses might increase during their retirement, such as healthcare costs.”

2. You Have Lots of Debt

“Large amounts of debt will severely strain your savings once you retire,” says David Walters, a certified financial planner and portfolio manager with Palisades Hudson Financial Group’s Portland, Ore., office. “If you can, reduce or eliminate credit card payments and car loans. Depending on your situation, paying off your mortgage or downsizing may also help in the long run,” he says.

Paying down debt before you retire might mean working more years than you’d like, but it will be worth it for the sense of ease that comes with not having all those monthly payments hanging over your head. Getting rid of debt also means getting rid of interest payments that can take a real toll on your long-term finances.

That being said, it’s tough to know what the best use of your money is when you’re facing a choice between putting that money in your retirement account and investing it or paying down debt. (For more, check out To Invest or to Reduce Debt, That’s the Question.) For any loan with an interest rate equal to or higher than what you’re likely to earn in the market – say, 6% – you’ll get the best return, and a guaranteed one at that, by paying off your debt. If it’s a choice between paying 3% in tax-deductible mortgage interest and saving more for retirement, the latter is probably the smarter option, unless you have a poor investing track record.

3. You Haven’t Tackled Major Expenses

You don’t want to wait until you’ve retired to address major, foreseeable expenses such as replacing your roof, repaving your driveway, purchasing a vacation home or buying a new car, says Pedro M. Silva, a financial advisor and chartered retirement planning counselor with Provo Financial Services in Shrewsbury, Mass. “These larger expenses can add up, especially when funds are withdrawn from taxable accounts and taxes need to be paid on every dollar.”

“We encourage clients to tackle large expenses before retirement because the impact to their portfolio can be significant,” he says. Suppose you need a new roof ($7,000), a new driveway ($4,000) and a new car ($10,000 down and $300 a month). These purchases, which require $21,000 up front, mean that you have to take $28,000 in pre-tax withdrawals from your retirement account if you’re in the 25% federal tax bracket, Silva explains. Plus, the $300-a-month car payment will cost you $400 a month in pre-tax dollars, and that could represent a significant chunk of your monthly Social Security income.

4. You Don’t Know What You’ll Get From Social Security

While you might not be relying on Social Security to meet most of your expenses, you shouldn’t ignore it, either.

“Most people expect to get something, but they have yet to estimate how much it will be,” Greene says. “The Social Security Administration offers a handy tool to help you make that calculation.”

Walters adds that if you haven’t reached full retirement age for Social Security – the age at which you can collect your maximum Social Security monthly benefit – you might want to postpone retirement until you do.

If you start claiming Social Security as early as age 62, your monthly checks will be 30% smaller than if you wait until you reach full retirement age. If you keep working those three or four extra years, not only will you receive a larger payment each month just for waiting, you might further increase your payment by adding more high-earning years to your benefit calculation. You’ll also, of course, have a few more years of paychecks to squirrel away for retirement.

5. You Don’t Have a Monthly Financial Plan

“Once you retire, paychecks stop arriving but bills keep showing up,” Walters says. You need to map out your monthly cash flow before you retire, he adds.

Planning your monthly cash flow means considering when you will start drawing Social Security benefits and how much you’ll receive, as well as how much you’ll withdraw from your personal retirement accounts and in what order.  If you have both a traditional IRA and a Roth IRA, for example, you have to think about the taxes and required minimum distributions (RMDs) on your traditional IRA withdrawals and how that affects your Roth IRA withdrawals, which won’t be taxed and aren’t subject to RMDs.

Having a monthly plan also means having a solid grasp of your expenses, says certified financial planner Kevin Smith, executive vice president of wealth management for Smith, Mayer & Liddle in York, Pa. Ideally, you should have two to three years of actual spending history summarized by category, he says, and you should analyze each category to determine how it might change during retirement. “Some expenses may go down, such as debts that may soon be repaid, whereas others, such as healthcare costs or travel and recreation expenses, may go up,” he says.

Knowing what your likely expenses will be means knowing how much income you’ll need. Once you know how much income you need each month, you can assess whether your nest egg is large enough to allow you to retire, or whether you need to keep working and saving and/or cut your anticipated retirement expenses.

6. You Don’t Have a Long-Term Financial Plan

“You should understand how long your savings will last and what spending level you can maintain over the coming decades,” Walters says. “No one knows exactly how long they will live, but bear in mind that expanding life spans and the increasingly high costs of long-term care may mean your portfolio will have to last longer and stretch further than you once thought.”

There’s debate about how much you should withdraw from your portfolio each year. There’s the 4% rule, which says you can tap 4% of your retirement assets each year as long as the rate of return on your investments is at least 4% annually. Your money should last at least 30 years this way.

And you do need to plan for your retirement years to last 30 years or more, Smith says. “Based upon actuarial statistics, for a couple retiring at age 65 there is a 50% probability that at least one will be living at age 92 and a 25% probability at least one will be alive at age 97.”

Some say the 4% rule is no longer safe because modern investment returns are lower than they were when the rule was developed in 1994. They suggest a lower rate, such as 2.8%, as a safe withdrawal rate to avoid running out of money prematurely.

Depending on your health, your portfolio composition and your risk tolerance, you’ll need to come up with a plan for what percentage of your assets you’ll spend each year – which might mean getting help from a professional financial planner.

7. You Haven’t Thought About Inflation

Inflation will affect your day-to-day expenses as well as the value of your life savings.

An inflation rate of 3%, Smith says, which is close to historical norms, would mean that your expenses will double in less than 25 years – well within a typical retirement period. Overlooking the effects of inflation is one of the most common retirement planning mistakes and can have serious long term implications if not properly accounted for, he says.

With average life spans much longer than they used to be, you need to manage your money carefully to keep up with or outpace inflation to reduce your chances of outliving your savings. Treasury Inflation Protected Securities (TIPS) will preserve your capital by paying enough interest to keep up with inflation and are considered extremely safe because they’re backed by the government.

If you want to earn investment returns that outpace inflation, look to stocks. Keep in mind that an 8% annual return is really only a 5% annual return after 3% inflation. Avoid keeping a lot of your nest egg in cash and cash equivalents, like CDs and money market funds. Their interest rates are so low that you’ll be losing money. In the short term, you might not notice, but in the long term, you could run out of money sooner than you expected.

8. You Haven’t Rebalanced Your Portfolio

“A lot of people take a passive approach to investing. They set it and forget it,” Greene says. But as you get older, adjusting your portfolio for the appropriate level of risk is key.

“When you are younger, you can afford to have your portfolio in accumulation mode, because you have time to make up any hits your portfolio takes,” Greene says. “As you get closer to retirement, you’ll want to have a strategy that focuses on income generation and asset protection.”

The accepted wisdom about how retirees should manage their portfolios consists of diversifying, preserving capital, earning income and avoiding risk. Diversifying across a variety of asset classes(bonds, stocks, etc.) and industry sectors – healthcare, technology, and so on – helps protect your portfolio’s value when the market declines, since one instrument or asset class might be performing well when another isn’t. Capital preservation means choosing investments that aren’t too volatile, so your portfolio value doesn’t fluctuate wildly. Dividends from stocks of big, established companies that have a long track record of performing well (or dividends from an index fund or exchange-traded fund made up of such companies) can provide a dependable income stream. And if you’re diversified and staying away from volatile investments, then you’ve taken care of the risk avoidance objective.

9. Retirement Worries You

“Even if your portfolio is in top shape, you may not be mentally ready to let go of your working life,” Walters says. “Working takes up a lot of energy, and some people may be anxious, rather than excited, to consider months and years of unstructured time ahead.”

If this sounds like you, think about pursuing a “second act” venture, working part-time or becoming a volunteer for an organization you care about, Walters says. “If you just retire without a plan, however, you can overspend in an effort to combat boredom and run through your savings quicker than you planned.”

10. You Love Your Job

There’s nothing that says you have to retire just because you’ve reached Social Security’s definition of full retirement age. Just look at Warren Buffett, who’s still working at 85 and has no plans to retire. He does it because he loves picking stocks – not to pad his $76.1 billion in net worth.

“If you wake up every morning and go to sleep every night excited about your job and what you get to do for a living, it is likely you are not ready to retire, and that is OK,” Greene says. “Continue living your life and enjoying every minute of it.”

Working has benefits beyond the financial. A job you enjoy engages your mind, offers social interaction, gives your days purpose and creates a sense of accomplishment. All of these things can help you stay healthy and happy as you age. You might also be able to stay on your employer’s health plan and possibly get better coverage than you would through Medicare.

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Retiring Abroad: What to Know Before You Go

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By Sonya Stinson | Key Bank

Retiring abroad can be a rewarding and life-changing adventure. But the financial, logistical, and lifestyle considerations can be complicated. Here’s a beginner’s look at everything you’ll need to help you prepare for the move.

Exploring the Possibilities

Before you move abroad, test drive the lifestyle by spending some extended vacation time in the area. That will give you a chance to get acclimated to the weather, the culture, and the tasks of day-to-day living. Try to venture outside of the tourist zones — noting the types of housing available and their proximity to shops, healthcare facilities, and other necessities.

If you’re thinking of moving to a country where you don’t speak the primary language, you might consider taking an intensive language course and using your vacation time to practice before you relocate.

Your preliminary exploration should also include research of the legal requirements for the move. Remember that international travel, immigration, and residency laws vary widely. If you’ve traveled previously to the country where you want to retire, you’re already familiar with its rules regarding visas for temporary visitors. If you’re going for the first time, you’ll need to find out the requirements well in advance of your trip by contacting the embassy or consulate of your destination country. If you’re planning to work once you move abroad, you’ll need to obtain a separate work visa.

Budgeting

Whether you’ll be working to earn extra income after retiring abroad or living off of your savings, you’ll need a budget — and your foreign residency can impact some key expenses. Medicare, for instance, doesn’t cover healthcare overseas, so you’ll likely need some type of private health insurance. In some countries, you may be able to save money because of the comparatively low cost of healthcare.

If you’re thinking of buying a home abroad, now’s the time to start thinking about international property taxes. You may also want to take a fresh look at your estate plan. Since most other countries don’t recognize U.S. wills and trusts, you may need a second set of those documents to address how you wish to pass on your overseas property.

Don’t forget to build some cushion into your budget for inflation, exchange rate fluctuations, and an emergency exit fund — in case health problems, political unrest, or other events force you to return to the States unexpectedly.

Tax Planning

Income taxes are another budget item to account for when planning a move abroad. You will still have to file annual tax returns with the IRS, and you may face additional income taxes in your country of residence. You may be able to lower your U.S. tax bill if you qualify for the foreign tax credit.

If you’re a working expat, you may be eligible for the foreign earned income exclusion, which exempts a portion of your income from U.S. taxes. The maximum exclusion for the 2018 tax year is $104,000.

In a small number of countries that have an income tax treaty with the United States, taxes will be removed from your Social Security benefits. The Social Security Administration’s website has information about the rules and processes for payments to retirees who live abroad.

Long-range planning is the key to any successful retirement. If you’re dreaming of retiring abroad, talk to a financial planner about creating an investment and money management strategy to make that dream possible.

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10 Best Things to Do on Mexico’s Riviera Maya

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By Jen Phillips | International Living

Stretching from Cancun to Tulum, the Riviera Maya is approximately 50 miles of soft sandy beaches and sparkling turquoise water. This renowned and well-loved tourist destination is well-equipped for fun, world-class diving, gourmet food, evening strolls on the beach, and so much more.

Given the variety of things to do here, it’s not easy narrowing it down to just 10, but here it goes.

 1. Stroll Down 5th Avenue

In the past decade, Avenida Quinta or 5th Avenue, a once sleepy fishing village in Playa del Carmen, has turned into a full-scale resort town. A pedestrian friendly district, it stretches for 70 blocks, and is lined with shops, bars, and restaurants. From people watching to street performers, “La Quinta” as the locals call it, is sure to entertain you.

2. Visit a Maya Ruin

According to historians, the earliest evidence of the Maya people dates to 1800 B.C. And, it was these Mayas who built huge pyramids, developed the complex Maya calendar, and created hieroglyphic scripts.

While the jungle reclaimed many of these temples, roughly a dozen of them have been excavated over the years. The two best known, are Tulum, perched on a cliff overlooking the Caribbean, and the larger Chichen Itza, a Maya city thought to be active from about 600 A.D. to 1200 A.D.

There are many guided tours that will take you to Chichen Itza or alternatively you could hire a driver.

3. Snorkel With Whale Sharks

Every summer, whale sharks migrate to the waters surrounding Cancun and Cozumel, and people come from all over the world to snorkel with them.

The pristine barrier reef also offers plenty of opportunities to admire the colorful tropical fish, stingrays, and other sea life that are in abundance year-round. There is also good snorkeling right off the beach, on Cozumel.

4. Relax Under a Palapa

If your idea of relaxation includes your feet in the warm sand, and a $2 cerveza(beer) in hand, you’re in luck. You can let your thoughts drift away with the current, at one of the many ocean-front beach bars. A palapa (thatched roof hut) overhead will protect you from the strong sun, and fresh ceviche (seafood dish) or delicious tacos will keep hunger at bay.

5. Enjoy a Beachside Massage

In Playa del Carmen, massage tables dot the beach. Why not treat yourself to a $20 massage, and you will experience the wonders of having someone work out any knots, while listening to the soothing sounds of the waves just 20 feet away from you.

6. Visit a Monkey Sanctuary

Close to Tulum, in the Akumal Monkey Sanctuary, rescued spider monkeys, macaws, and other animals, are rehabilitated and in some cases released back into the wild.

Here you can experience a personalized four-hour tour, deep in the jungle, where you can interact with some of the animals, learn about the eco-system, and even cool off in the Sanctuary’s cenote.

7. Float on an Underground River

Cenotes or sinkholes, are a distinguishing feature of the Yucatan Peninsula. They occur when the natural limestone collapses exposing fresh water underground, and a cooling swimming opportunity.

Hundreds of cenotes are scattered through a 100-mile radius, and only a decade ago a 30-mile long network of rivers was discovered.

Some cenotes are underground, and you reach them by stairs leading into a cave-like environment, where hundreds of stalactites and stalagmites surround you. Others are more like swimming pools.

Many cenotes are open to the public and have an entry fee of $5 to $6.

8. Ride a Camel

Yes, you read that right. While camels aren’t native to Mexico, a few enterprising tour operators offer a “camel safari”, just outside of Playa del Carmen. Here participants experience what it’s like to sit astride the humped creatures as they pick their way through the sand.

9. Experience Jungle Adventure

From ziplining, to off-roading in the jungle with ATV’s, there are many opportunities for thrill-seekers in the Riviera Maya. Just minutes from the city of Playa del Carmen, there are Xcaret, Xplor, and Alltournative eco-parks to boost your adrenaline. There you can choose day-passes for around $95, or reserve specific activities depending on your interests.

10. Visit a Natural Bio-Sphere

If observing hundreds of species of birds and wildlife is your idea of fun, then you’ll appreciate the Sian-Ka’an Biological Reserve. Located just outside of Tulum, and 45 minutes from Playa del Carmen, it is the largest protected area in the Mexican Caribbean. This stunning area is a UNESCO World Heritage site, and guided boat tours give you a glimpse of crocodiles, dolphins, sting rays, and much more sea life.

There are also dedicated tours for bird watching, hiking, kayaking, and snorkeling. There’s so much to do at Sian Ka’an that you can go multiple times and still find something new to discover.

Perhaps the best thing to do in the Riviera Maya is to nap in a hammock knowing there’s a world of opportunity that awaits you anytime you’re ready.

Original Source 

Pros and Cons of Retiring Abroad

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By  Jason Holland | International Living

The decision to retire abroad is not something that should be taken lightly. For many people it’s the best decision they’ve ever made—the adventure of a lifetime. And their only regret is that they didn’t make the move sooner. While other people just can’t adapt to life in a new country.

How do you figure into which camp you fall? Many people making big life decisions make a list of the pros and cons. That works in this situation too.

Check out the pros and cons list below for retiring abroad. It’s general information about what you’ll encounter when living abroad in Latin America, Asia, Europe, the Caribbean…or wherever you want to go. You’ll discover the many benefits you’ll enjoy…and the drawbacks too.

Pro – Cost of Living

One of the primary reasons many people are looking at moving overseas in retirement, is that you can live well for much less than back home. In many countries in Central America, for example, you can live well on $2,000 a month. In Asia, it can be even less. And you’d be surprised how affordable Europe can be; yes, even France.

Prices for rent, real estate taxes, healthcare, food, utility bills, and more can be a fraction of what you’re paying right now. Your Social Security, pension, or retirement savings will go much farther. And you’ll be living in prime areas, close to pristine beaches, in well-preserved colonial towns, or on a hillside with views of vast forest and farmland.

With these low costs, you could even retire sooner than you planned.

Pro – High Quality and Affordable Healthcare

With the chaos surrounding healthcare and insurance in the U.S., moving abroad can be a welcome respite for expats. In many countries, expats who become official residents have access to a government-run healthcare system, that provides extremely low cost but good quality medical services.

There are also private clinics and hospitals offering all the latest treatments and procedures at up to half of the cost in the U.S. Low cost private insurance options are also available. Having a chronic medical condition is not an obstacle to retiring abroad.

Pro – Great Weather

For decades people from the northern states of the U.S. and Canada would retire, or snowbird, to places like Arizona and Florida to escape dreary winter weather. With ease of travel and low costs, why not go a bit farther?

In the tropics, you’ll find warm weather year-round. For some the coasts are too hot and humid, but get some elevation and you’ll find areas like Costa Rica’s Central Valley with spring-like conditions all year round.

Pro – Adventure

Maybe you didn’t travel much during your working life, due to commitments or finances preventing you from doing so. But, when you live abroad you’re having an adventure. You’re seeing new places, experiencing new cultures and languages, meeting people from all walks of life, and so much more. Whether you’re trekking through a tropical rain forest in Panama…strolling the frenetic streets of Hanoi…or enjoying an espresso in an Italian piazza…it’s an exciting experience that’s a lot of fun.

Con – Culture Shock

You’ve lived your whole life in one culture. You’re used to how things “work.” So it can be a bit of an adjustment when you move abroad. People are people around the world, with most being friendly and welcoming, not to mention helpful to newcomers.

But there are key differences you must get used to. In Latin American towns and cities for example, noise is a fact of life. Barking dogs, loud parties, fireworks…it’s part of the experience. Ideas around personal space are very different in other countries as well. And of course, the food and products you find in stores, not to mention local cuisine, can be very different.

You’ll also find bureaucracies tough to navigate if you’re getting a driver’s license or opening a bank account, with seemingly arcane requirements.

Most expats do manage to adjust to this new way of living. That loud neighborhood festival. Why not join the fun?

Con – Language Barrier

Unless you’re going to an English-speaking country, like Belize, you’ll have to learn at least a serviceable amount of a new language.

In many countries, locals speak at least some English. In more tourist-friendly areas, you can get by without speaking the local language at all. But, to have a richer more rewarding experience it is recommended that you try to learn the local language. You’ll make local friends, better navigate government offices, and be a better neighbor.

Con – Leaving Behind Family and Friends

You build up a social network over a lifetime. As an expat you will form close ties with the new people you meet, fellow expats and locals. But you do have to leave family and friends behind.

Fortunately, with low cost flights to many destinations around the world, it’s easy for them to come visit you, or for you to fly back home for holidays and special occasions. From Central American countries like Nicaragua, Panama, and Costa Rica, Miami is only few hours’ flight.

Technology like Skype and FaceTime means you can do video calls for free with your kids or grandkids. Also, with international cell phone plans and services like MagicJack (which give you a U.S. phone number), you can easily stay in touch. So, while the physical distance may be far, you can stay close to family and friends.

Putting It All Together

While the overseas lifestyle isn’t right for everybody, it can be life-changing for the right type of person. If you’ve gone through the list and found the pros outweigh the cons, and you feel like you have what it takes to be a retired expat, you should consider taking the next step. Start reading about destinations that you are interested in, and relentlessly research to find out the pros and cons of those specific areas. Narrow down your list. And then visit to see with your own eyes.

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Cheap Places to Retire to in Mexico

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By Teo Spengler | Leaf Group

What’s the best foreign retirement destination for retirees from the U.S.? The winner is Mexico. American retirees voted for Mexico as their retirement destination of choice in the only way that really counts: they actually retired there. Between one million and two million Americans have chosen to spend their golden years south of the border, and it’s easy to understand why. Yes, the cost of living is lower than in the states and the weather is warmer, but that’s just for starters. Mexico is also close enough to home to allow easy trips back to see family or get Medicare-covered health care. On top of that, you can drive down to Mexico instead of having to take expensive flights, stay up to six months with just a passport and find many cities in Mexico that have friendly ex-pat communities. What other country can compete with that? If your thoughts are heading south of the border, consider these cities.

Merida

Merida has been called the most European-style city in Mexico and was recently named by CNN Money as Number 1 on their list of best places to retire abroad. Located near the Gulf Coast of Mexico in the state of Yucatan, Merida’s Spanish colonial architecture gives it an unexpected elegance and grace. Peaceful, but lively, the city offers exquisite food, fabulous weather, and a proximity toYucatan beaches and Mayan ruins. Merida’s beautiful central square, the Plaza Mayor, is the town’s gathering place, but you’ll also find museums and music venues in the city. In fact, citing its music and cultural flamboyance, Lonely Planet named Merida the North American capital of culture. And Merida is already home to over 3,000 Americans, making up a significant expat community. What better place to spend your Social Security check?

Guanajuato

The romance of colonial architecture, and the city’s silver-mining history gives Guanajuato immediate appeal. This university town (Universidad de Guanajuato) feels young and charms you with its brightly colored houses crammed onto steep slopes of the bowl-shaped town. The downtown colonial buildings are opulent, the plazas are filled with shade trees, and the excellent marketplace is always lively. Guanajuato lights up during its famous annual international arts festival, the Festival Cervantino. But thanks to the 20,000 university students, Guanajuato also offers cultural activities year-round, including films, theater and music. The weather is generally warm, although nights can be cool in the winter.

San Miguel de Allende

With small-town friendliness and magical outdoor beauty, San Miguel de Allende has what it takes to please U.S. retirees. Many already call it home and have since the late 1960s. The town is located in a flat valley bordered by low hills, with lots of opportunities for outdoor activities and an impressive community of expats. It’s not the cheapest retirement place in Mexico, but the cost of living is still less than in many U.S. cities. And the slightly higher prices might be worth it if living in a beautiful, astonishingly social colonial town appeals to you.

Mazatlan

If you like the idea of spending your retirement walking on white sand beaches with blue waves crashing, Mazatlan in the state of Sinaloa could be a good choice. Like the city of San Miguel de Allende, Mazatlan has a large, established expat community which helps retirees make friends easily. The locals are also very friendly. This is a resort town on the Pacific Ocean that also offers an authentic, historic core – the Zona Dorada is the nightlife and hotel center. Old Mazatlan has 19th-century landmarks like the Immaculate Conception basilica, and good, inexpensive restaurants and plazas where neighbors gather in the evening. Mazatlan is also known for its big-game fishing and sporting events like triathlons, marathons and baseball games.

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Residency Options In Mexico

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People all over are inquiring about how to gain residency in Mexico. More and more travelers and retirees are finding that there are major benefits to living in this country. Many baby boomers who are now retiring give the same general reasons for choosing to relocate there, and they all add up to this: you can enjoy a better quality of life for less. As the cost of living keeps rising in the United States (and across most of the world’s more advanced economies) and inflation is on the rise, it makes sense that anyone would want to go to a place where more costs less.

Take that sizable benefit and combine it with Mexico’s abundance of gorgeous beaches, fresh tropical produce, and perfect weather, and this residency thing is really a no-brainer. It is also important to note that Mexico has one of the most powerful passports in the world, placing 24th when compared against others for global travel freedom. A Mexico passport holder can visit 144 countries without a visa.

Here are the residency options and the visas available to those looking to go to Mexico:

Mexico Visa: Visitor Permit

When you first arrive in Mexico as a tourist, you’ll receive an entry permit as a visitor. As a visitor, you won’t be privy to any of the perks of residency, it’s just a step in the right direction. Think of it as a tourist visa. That’s essentially what it is. You’ll have to fill out an immigration form to get your visitor permit, and this will allow you to stay for a period of six months.

You cannot work during these six months if you are visiting as a tourist, but if need to do so (maybe you’re just getting a feel for what Mexican life would be like and you have to work while you’re at it), you can purchase a “permission to work” visa for only $155 USD. The only stipulation here is that you cannot be paid in Mexico for your services. If you’re working remote from a company back home, they’ll just continue to pay you via your home bank account.

Temporary Resident Visa

Residency in Mexico is relatively quick, and it is also very affordable. However, you can’t complete the process (or even begin it) while staying in Mexico on a tourist visa. You’ll have to go back home to do that. You will need to complete the appropriate paperwork at a Mexican Consulate and pay a $40 USD fee for a temporary visa valid for six months. During that time, you’ll make your way to Mexico and once there, have 30 days to swap out that temporary visa for the official visa. Don’t miss your 30-day mark, or it’s extra paperwork and fees, which is all an extra headache that’s completely avoidable.

Once you acquire your temporary resident visa, you can stay in the country for up to four years. You cannot work while holding this visa unless you apply for permission to work, as was mentioned above. The fee for that remains the same, at $155 USD. You’ll also need to provide an offer letter showing that you’ve already accepted a position.

You can qualify for temporary residency by proving you have the ability to support yourself financially while living in Mexico. This includes the cost of housing and meals, and the minimum salary amount for this qualification usually comes out to be at least $1,553 USD per month. You will need to provide your last six months’ worth of bank statements to prove this income, and if you are bringing dependents, you’ll have to have an extra $520 in income per dependent. You could also prove that you own a property in Mexico (which does not require any type of residency to own) that is worth at least $208,000 USD.

After your four years as a temporary resident run out, you must either leave Mexico or apply for permanent residency. Those four years spent as a temporary resident will automatically qualify you as a permanent resident, so there’s no time lost there.

Permanent Resident Visa

If you already know you’d like to live in Mexico for the long-haul, you can skip right along to the permanent residency option and bypass those other steps. There is no time limit on the permanent resident visa, and it automatically allows you the right to work in the country, just like a citizen. Citizenship itself, though, is a separate process and so you still won’t be able to vote.

For permanent residency status, you’ll need to meet higher income requirements. Your monthly net income will have to show that you’ve made at least $2,588 over the last six months, either through a pension or net income. Otherwise, you can show investments with an average monthly balance over 12 months of about $103,500 USD.

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Retiring to Mexico: The Best Choice for You

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By Thomas Lloyd | Let’s Retire in Mexico

When you’re thinking of your retirement, there are many things to consider. Amongst those, is the ease with which you will be able to move around. This means actually living in a city that is relaxing, close to everything, and where transportation is at hand. A place that requires you to drive everywhere most likely means traffic, and nobody wants to deal with such things during their retirement. It’s your turn to sit back, relax and enjoy. That is why retiring to Mexico has so many benefits. In fact, it is one of the top destinations in the country for Americans and Canadians to spend their golden years.

There are many benefits to retiring in places such as Playa del Carmen. Not only do the big expat communities help each other out constantly, but the quality of life is impressive. Walking everywhere is easy, everything is nearby, there are plenty of things to do, and there is also a great infrastructure.

MEDICAL ASSISTANCE

Medical Tourism

One of the perks of retiring to the Riviera Maya is its top-notch medical industry. Many English-speaking professionals work here and cater to the well-being of American and Canadian expats. Retiring to Mexico means having the best possible medical care at hand with many private clinics and dentist’s offices available.

MONEY GOES A LONG WAY

The Mexican peso is constantly fluctuating and the dollar gains more and more strength against it. While that may be bad news for our Mexican friends, it is a great opportunity for Americans and Canadians. Dollars will go a long way here not only because of its value but because living in Mexico is very cheap in comparison to other countries. Not only when it comes to real estate but also with simple things such as a meal out in a restaurant, or grocery shopping and even transportation.

RETIRING TO MEXICO INCREASES QUALITY OF LIFE

The Riviera Maya is a friendly and welcoming place. It is home to a close-knit community that will help you find anything or recommend places to visit. Many people will also willingly volunteer to help you in translating documents, instructions, or anything else you may need. But because Mexicans are so friendly and open to foreigners, the quality of life is much better, too. Friends are found around every corner. Great food is served in every restaurant. Beers and cocktails flow by the beach nonstop. Activities to do include swimming, snorkeling, diving, yoga, fishing, and many others that keep everyone young at heart.

MOVING AROUND IN MEXICO

If for some reason you decide to use a vehicle, there are many trusted rental cars that offer incredibly low prices in comparison the USA. Renting a car to pick friends up at the airport, or to get around is an easy and affordable process. However, the transit system (bus and colectivos) are very reliable, timely and good. There are a few terminals scattered around the Riviera Maya that will take you anywhere and bring you back.

YEAR-ROUND WARM WEATHER

The weather in the Riviera Maya is very consistent with the sun always shining and warm temperatures throughout the year. The average temperature is 28°C, while it can fluctuate anywhere between 22°C and 36°C. The weather makes it a great place to retire due to the amount of activities one can enjoy under the sun.

All in all, there is no reason to avoid retiring to Mexico. It is affordable, fun, friendly, beautiful, and offers a great deal of Americanized standards that you are used to. Shopping is easy and cheap and moving around either driving or in public transportation is no hard feat. Mexico is definitely the number one choice for you to retire.

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