Retirement may still be several years away, or it might be right around the corner. Either way, it’s not too early to ask yourself some important questions. What do you envision your lifestyle to be when you do retire? Where would you like to live? Will the money you have saved for retirement, fund the lifestyle you desire? Asking these questions will most likely raise your anxiety level. But don't worry. We’re going to show you how to have a great retirement lifestyle even without a huge nest egg. And, you can continue getting answers to Retire Your Way.
It is true that retirement choices, how and where you live, will be dictated by money, of course. How much you’ve saved, interest from investments, Social Security benefits, and the cost of living wherever you settle. But there are ways to work with less and ways to create more. We’ll discuss this throughout. We’ll show you that you do have endless retirement choices and you can have a great retirement lifestyle even if your 401k isn't as healthy as you'd like it to be.
Just Using the Averages
Even when you do your research on retirement costs there is a myriad of variables. One Social Security check or two, at what age you decide to start taking your Social Security benefits, the mileage per gallon you get on your vehicle, how many vehicles you have, the type of wine you drink and food you eat, the type and number of trips, shows, and other forms of entertainment.
However, we can also just use the averages. To retire in the U.S. you can estimate that it will cost around $6,000 per month to live depending on the state in which you choose to live. And, the average Social Security benefit paid monthly is $1,413. Therefore, the typical retiree is going to need to make up a shortfall of about $4,587 per month.
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If you would like to look at the estimated cost of living in each state, the estimated total amount needed to retire, and the estimated amount of Social Security benefits you'll be paid...
The Cost of Retirement Living Gets More Costly
One factor to keep in mind is that retirement living gets more expensive each year. We average an annual 1.7% cost of living increase in this country. We do get a bump in our Social Security benefits each year, around 1.6%. But that’s only a 1.6% increase on the average $16,956/year benefit which equals about $271/year. The 1.7% cost of living increase is on your entire cost of living. So, on a cost of living of $72,000, that’s an increase of $1,224. The net negative each year is $953.
What if You Don't Want to Live in Sandusky?
Here’s the problem with all this data. None of it matters if you don’t want to live in Sandusky, OH. There's nothing wrong with retiring on Lake Erie if that's the retirement lifestyle you want. However, if you retire in a place that you don’t want to live, what was the 40 years of hard work for? What if you always envisioned retiring on a beach somewhere? Or, at least live where you don’t have to shovel snow and can get out of the house every day. What if you wanted to meet your buddies for a round of golf on Wednesdays but can’t because the temperature just hit 30?
What we do during retirement is vital to our health and vitality. Staying active and socially connected can add years to our life and life to our years. Activity each day can raise your energy level has tremendous health benefits, and boosts the immune system. It’s also good for the mind, memory, and mood. So, how and where we retire is an extremely important phase of our lives.
Forget the Cost of Retirement for Now – What Do You Want?
So, instead of looking at the numbers and deciding you need to live where you don’t really want to, identify the retirement lifestyle that you want and find a place that can provide that lifestyle. For just a while, don’t worry about the money part. We’ve got some ideas to toss out to you below that can help with that. Let’s first get you living where and how you want in retirement.
Do a ‘Dream Splat’
What’s a dream splat? It’s a brainstorming session about your dreams and goals. In this case, what does retirement look like for you? Where do you live? The town, the street, the home. Is it on a beach, a golf course, near the mountains or in the mountains? What is the surrounding area like? Is it a city or in the country? Is it a beach town, a mountain town, a farm town? What are your hobbies and activities? What will you do to stimulate your mind? Will you do volunteer work, write a blog, take online courses, or attend a local community college? Would you like to grow orchards, make crafts, do woodworking, or blow glass? Are you hiker, biker, kayaker, or swimmer?
All of it. Write it down. As you go through this process what will happen is that you will envision the type of town or city and come up with areas that will most likely have this type of town. Go through this exercise and at least narrow it down to some areas. Maybe even have some fun and get on the internet and locate some towns. Use Google Maps to see what’s around the town. Read a little about it and what there is to do there.
Let’s say that you decided you want to live in a beach town, be close to shopping, within 45 minutes of a major city and airport, you want to volunteer at an animal shelter, and do stand-up paddle boarding and biking. If those are your retirement lifestyle preferences, the Gulf Coast of Florida from the Pan Handle to Naples is full of towns for you to choose from.
Will Your Money Go Far Enough?
Now that you have found the place that has everything that you want, figure out if your existing retirement money will allow you to live there. Let’s use Largo, FL just south of Clearwater on Florida’s Gulf Coast, as an example. The average cost of living in Florida is $61,000 or $5,083/month. Let's say you subtract out your Social Security benefit and your investment income, and maybe you’re coming up short. Or, maybe you only have enough to live there a certain number of years.
In fact, what if, after going through this research, ultimately the lifestyle you want isn’t available anywhere in the United States for the money you have for retirement? Don’t settle just yet because you haven’t even begun to exhaust all your options.
Think Outside the Box – Think Outside the U.S.
On a list compiled by WorldData.com, the United States out of 101 countries has the 15th highest cost of living. That means that 86 countries are less expensive in which to live. Italy is 10% less, Spain, 20%, Greece 25%, and Portugal is 27% less expensive than the U.S. OK, so maybe those countries are too far from family and not great options for you.
All right, here are some countries within a 2 to 3-hour plane ride to Miami or Dallas. Costa Rica is 30% less expensive than the U.S. Panama 33%, Ecuador 44%, Mexico 53%, and Columbia is 57% cheaper than the U.S. Countries to consider like Belize, the Dominican Republic, Curacao, and Honduras weren’t on the list but they too are far less expensive places to live compared to the United States.
Take a 10-Day Trip and Explore the Possibility
My wife, Shirley and I started considering retiring outside the U.S. some time ago. We took a trip to Troncones, MX just north of Ixtapa. Troncones is a little fishing village on the Pacific Ocean. During our time there we met several ex-pats, folks that were born in the U.S. but are now living in Troncones. We learned that they had moved there, and were either fully retired or had ways to produce income there such as selling real estate.
It got us starting to think about our own retirement lifestyle. Since then we’ve traveled extensively in the Caribbean and done a lot of research on several Caribbean, Central, and South American countries as possible places for us to retire. If you want to begin your own research start with Retire in the Caribbean for Affordability and Lifestyle.
We have also had some close friends move to Ecuador and Costa Rica to enjoy their retirement years. My long-time friend from college and his wife bought 3 rentals units on a piece of property in Uvita, Costa Rica on the Pacific Coast. They live in one of the units and rent the others out using Airbnb.
If you’ve never considered living elsewhere than the good ole U.S of A, this might be a bit difficult for you to consider. But stay with me for a moment. Ask yourself why living in the U.S. is a priority. You might answer with some of the following:
You Want to be Close to Family
If you have a need to see your kids and grandkids a lot, living in another country could be a challenge for you. However, regardless of your desire, consider how much you will really see them. They are in a period of their life where work, school, and other things are a priority. If you’re envisioning a scene out of Bluebloods where the family gets together for dinner every night, that probably isn’t going to happen.
Further, visiting grandma and grandpa who live in another country would be ‘pretty cool’ for your grandkids. Plus, you can visit them too. Many of the places that we’ll suggest you look at are closer than some places you might travel to here in the U.S.
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You Only Speak English
If you’re concerned about not being able to communicate with the locals, don’t be. In the countries we’ve researched, there is a significant ex-pat community. That means that there is a lot of English-speaking people from the U.S. and Europe that have settled there. Which, in turn, means that the locals know enough English to be able to communicate sufficiently with these folks. Plus, maybe it would be great for you to take a course in Spanish or another language. There are many online and offline options available to you. And, you’ll learn it much quicker by being immersed in the culture. It could be fun to become a Spanish or French speaker!
You Want to be Close to Friends
It’s true that your life-long friends may not be right down the street anymore. But you’ll be able to communicate with them just as often. Have you heard of the WhatsApp phone app? It’s an app available for Android and iPhone cell phones that gives you the ability to converse with people all over the world. You can even have free video calls so you can see the person you’re talking to. If you don’t want to use a cell phone it’s also available for Windows or a Mac so you can have it right on your laptop or desktop.
We've done a lot of research into communications from abroad to the U.S. This was particularly important to us as we will continue to run our U.S.-based business from the Caribbean. See that research at Phone Solutions for Expats that Own a U.S. Business.
Also, you can make new friends easily. As mentioned above, there are good-sized ex-pat communities that are very welcoming of fellow Americans that have decided to make the move. These communities have clubs with all types of focused interests. You’ll be so busy making new friends you may even forget to call your old ones.
Good Healthcare is Very Important to You
This is a big concern, I know. In fact, with being a cancer survivor and needing to get scanned regularly this is a topic that we’ve researched. You’ll perhaps be surprised to know that many countries outrank the U.S. with lower health care costs for their citizens and overall quality of healthcare. This is true despite that the U.S. per capita spending on healthcare is more than double most other countries.
Costa Rica, Chile, Columbia, and virtually all European countries were ranked higher than the U.S. However, once you find a country and a specific area in that country that interests you, you’ll need to research hospitals, doctors, and other facilities in that area. Another point is that many countries outside the U.S. have universal healthcare available to residents for a much lesser amount than private health insurance including supplemental Medicare payments here in the U.S.
You've Heard that the Crime Rate is High in Other Countries
It is true that the many Caribbean, Central American, and South American countries have a higher crime rate than the U.S. But just as in the U.S. the crime rate is higher in specific areas and not necessarily in areas where Americans would consider retiring.
Another factor is that violent crimes occur predominantly due to the drug trade and amongst gangs. It’s actually very similar to circumstances here in the U.S. As an example, Belize City has a rate of 40 homicides per 100,000 people. To put that in perspective, some cities in the U.S. have a similar or higher homicide rate such as Baton Rouge, New Orleans, Detroit, and St. Louis. If the crime rate of these cities is a factor in you deciding not to live there, then choose a different location.
Instead of Belize City, look at the beautiful island of Ambergris Caye in Belize, where the crime rate is much lower. You will find that this trend, where crime is higher amongst the local population in the major cities versus the areas in which ex-pats choose to retire, is common. As it is, again, very similar to circumstances in the United States.
Courtesy of International Living
What About Taxes When Retiring Outside the U.S.?
One thing that you might not think about right away, at least we didn't, is taxes. What are the tax laws for U.S. citizens living outside the U.S.? Once we did give it some thought we did the homework. To learn about tax laws and requirements while living abroad visit Expat Taxes - What You Should Know.
The Cost of Retirement Living per Month in our Top Choices for Retiring Outside the U.S.
Ambergris Caye, Belize - $2,700-$2,900/mo
Curacao - $2,000 to $2,500/mo
Isla Colon, Panama - $1,400/mo
Las Terrenas, Dominican Republic - $2,500/mo
Isla Mujeres, Mexico - $2,500-$3,000/mo
Puerto Viejo, Costa Rica - $2,000-$3,000/mo
Roatan, Honduras - $2,000-$3,000/mo
To Receive All the Details on Our Top Choices for Retiring in the Caribbean fill out the form below.
Please note that there is a heavy concentration of the Caribbean islands on this list. The primary reason is that the Caribbean is the retirement lifestyle Shirley and I want. The only exception is Puerto Viejo, Costa Rica. Costa Rica, of course, is not an island. But the town of Puerto Viejo is on the Caribbean Ocean.
How About Puerto Rico?
When thinking about places to retire outside the States, Puerto Rico should be a consideration. It's within a couple of hours plane ride from Miami, it has all that the Caribbean offers, and it is a U.S. territory so you'll not have to adjust quite as much to different laws. Speaking of laws, Puerto Rico has some of the most favorable tax laws anywhere for U.S. citizens. And, there are some great ex-pat communities already thriving there. To learn more, visit Best Place to Live in Puerto Rico for Retirement.
Regardless if one of these choices above caught your attention or not, what should have caught your attention is the much lower cost of living. Retiring outside the U.S. can give you a higher quality of living for a lot less money. And, it can help you retire much earlier than you thought possible.
Wherever You Choose to Retire – Will You Have Enough?
Regardless of where you choose to retire and the retirement lifestyle that you desire, it comes back to the original point. Whether you can get what you want is about the money you have. Will you have enough? Perhaps you already know that you’ll need another income source beyond your retirement savings and Social Security. Or, at least you’re thinking that you might.
Find a Way to Generate More Income Before You Retire
In order to bridge that gap, many retirees will need to work a part-time job to continue bringing in money. The problem with getting a job, if even part-time, is that you’re trading time for money. Haven’t you already traded enough of your life for money? In addition, what kind of money can you earn with a second job? According to Work.Chron.com, the average hourly wage in retail for part-timers is just $9.61/hour. At 20 hours a week that’s just $768.80/month before taxes.
And, do you have 20 hours a week or want to work another 20 hours a week? Even if you wait until you retire to start something part-time will the estimated take-home pay of $666 (US) make a big enough difference? Isn’t the point of retirement to enjoy what time you have left?
A Far Better Option is to Start a Business from Home
Instead of waiting until you retire to start bringing in supplemental income, why not start a side business from home right now that will pay you now and continue to pay you after you retire? If you start it and develop it now, you’ll have to work less later for the income you’ll need then.
Our recommended option is to find a way to generate more income now and have that income continue coming in when you retire. For more visit Work From Home.
If you’re going to do something to make more money to fund your retirement, we highly recommend that you do something that has the following 3 components to it:
We’re going to give you specific options and suggestions for generating income now and/or after you retire. But whatever it is that you choose to do, it must develop residual income. What is residual income? Its income earned now and in the future for the work that you’ve already done.
In 2012, after we had both lost our jobs in the recession, Shirley was running her own bookkeeping and accounting business. It was a good business. She had over 50 small business clients. Here was the problem. She was working 6 and sometimes 7 days a week. She couldn’t add more clients to increase her income because she was already maxed out. The other problem was that if she stopped working for these clients her income would stop overnight. She was trapped. Her business wasn’t working for her, she was working for her business.
We then fell into a work from home opportunity in the credit repair industry that paid us every week but also paid us residually. It pays us income in the future for every new client we bring on board. We still earn residual income from that business and will continue to do so for many years to come.
Residual Income is Like an Insurance Policy
This residual income became very important when I was diagnosed with kidney cancer in 2017 and had to take 6 weeks off to recover from surgery. It also allowed me to slow things down for several months to fully recuperate.
There are many residual income opportunities out there so make sure you choose wisely. We’re going to give you some options below that will produce residual income.
Make Money from Anywhere
The other key component to any business from home that you start is that you can do that business from anywhere. All that you need is a laptop and a cell phone. That way, if you start it now you can work your business when you travel. And most importantly, you’ll be able to bring your business with you anywhere that you decide to retire, even outside the U.S.
This past summer Shirley and I decided to get out of the Florida heat and rent a home near the foothills of the Blue Ridge Mountains in North Carolina. We were there for 5 weeks. We worked our business from our laptop and cell phones a bit each day. But we still had plenty of time to hike, bike, kayak, go to concerts and immerse ourselves into the wonderful culture of the western Carolinas.
To help you think about what types of online businesses you could start, visit our article What Business to Start?
Make Money While You Sleep
There are well-documented upsides and downsides to the internet and technology in general. One of those upsides is the ability to run an online business and generate income 24 hours a day, 7 days a week. Your web site or blog works when you don’t. People are searching for information and items on the internet in all time zones and at all hours of the day and night. If you have the right business model, you can generate income whether you are awake or not. You can also generate income whether you take the day, the week, or the month off. That’s a great business model for enjoying a great retirement lifestyle.
Couples Working Together
Through our travels and relationships that we develop, we see more couples working together than ever before. Two people that truly respect each other can combine skills and create a powerful business force. Especially if the common goal is to retire sooner and/or retire with a better lifestyle. It's also a way to ensure that your spouse, significant other, or partner ha an income source that they know how to operate should something happen to you. Learn more about Couples Working Together.
Options for a Work from Home Business
Direct Selling or Network Marketing
Let’s get one thing out of the way up front. The direct selling or network marketing industry has come a long way in the last 20 years. It has matured and developed into a legitimate home-based business opportunity for people of all ages. For those that don’t succeed the number one reason is that they don’t work it.
More millionaires are created in network marketing than in any other industry. You probably aren’t necessarily wanting to become a millionaire. But the chances are pretty good that you can develop a business that generates $1,000 or more monthly on a part-time basis. The best part is that you can start that business now and bring that business with you to wherever it is that you decide to retire. You can choose to keep working that business in retirement or just collect the residual income that is generated by it.
Why We Became Network Marketers
It’s all about residual income, having a business we can take with us anywhere, having a business that produces income while we sleep, and having multiple income streams.
We talked about this already. It’s important that if you’re going to start a business, that it generates income for you in the future from work that you do today. As an example, with our credit repair business, we continue to earn income after a sale when our customers make their monthly payments. In addition, when our Agents build their business by bringing on other Agents, it builds our revenue and commission each month.
A Business We Can Take Anywhere
We take our network marketing businesses with us anywhere in the world. Virtually everything is done online and by phone so all we need is an internet and cell phone connection. We can even use Zoom or WhatsApp to have video calls with people.
A Business That Produces Income While You Sleep
If you’re going to have a business you want that business to produce income all hours of the day with or without you. In the case of network marketing, by having other distributors and earning income from what they do, we can earn every time one of them sells something. We don’t have to be awake for that.
Blogging and Affiliate Marketing
Perhaps you have a passion and specific knowledge about a topic that others would be interested in. And, you would love to have the time to write about it. Starting a blog as we have here with Lifestyleover50.com is a great option.
People need and want to know what you know. Google receives over 63,000 searches per second. That translates into at least 2 trillion searches per year, 5.6 billion searches per day, 228 million searches per hour, and 3.8 million searches per minute.
Let me give you a couple of examples. Let’s say you’re a woman that raised kids. Your kids are now grown and have their own lives. But you have knowledge that current Moms would love to have. You could title your blog, “Not Your Mothers Advice”, as sometimes its better to receive advice about raising a family from someone other than your own mother. I checked GoDaddy and that domain name is taken but you could find a variation of it.
If you’ve become an expert over the years in having the perfect manicured lawn and yard, you could have a blog about lawn care. You could call it “The Lawn Junkie”. By the way, thelawnjunkie.com is available via GoDaddy. For those that like to write and be creative, blogging is a very fun and cathartic thing to do.
How Do You Make Money with a Blog?
Writing a blog and making money with a blog are skills that most need to learn. I had been writing a blog for several years before we launched LifeStyleOver50.com. However, I wasn’t doing what most people do to earn income from that blog which is affiliate marketing. I had to learn that skill.
What is Affiliate Marketing?
Affiliate marketing is basically writing about topics and giving your readers an opportunity to purchase products and services related to your content. You would become an affiliate marketer for companies that sell their products online.
There are hundreds of thousands of companies that have an affiliate program. In fact, most companies that sell online have an affiliate program they operate themselves, or they are part of a network such as Commission Junkie or ShareaSale. When someone clicks through from your blog to a company for which you are an affiliate, and they purchase something, you get paid a predetermined commission on that sale.
Going back to our example of blogging about giving advice to mothers. You could offer books to read. In addition, you could offer products Moms use such as baby monitors, children’s clothing, online courses for kids, healthy snack options, and more. The possibilities are endless.
If you’re, “The Lawn Junkie”, you could offer tools, lawnmowers, edgers, grass seed, fertilizer, and on and on. You write articles about certain products that you use and recommend. People are online every day looking for recommendations so they can make a purchase.
Why We Became Bloggers and Affiliate Marketers
Just as with network marketing, it’s about generating residual income, having a business we can take with us anywhere, having a business that produces income while we sleep, and having multiple income streams. Where have you seen that before?
If you’re going to start a business, it's important that it generates income for you in the future from work that you do today. A blog article that I write today recommending a certain product or products, can generate income for years to come as people read it and buy those products.
A Business We Can Take Anywhere
Traveling or moving to another country is actually an advantage for our blog and affiliate marketing business. It will give us more to write about and more people to help. As you can tell, by doing research about places to retire to, we have been able to deliver valuable information to you for your retirement.
A Business That Produces Income While You Sleep
If you’re going to have a business, you want that business to have a very strong online presence so people can find it at all hours of the day. A blog obviously fulfills that requirement. We can wake up in the morning and have more money in our bank account than when we went to bed the night before.
Why We Are Both Network Marketers and Affiliate Marketers
It’s very simple. We want multiple streams of income. The are many reasons to have multiple income streams especially as we approach retirement. Businesses have seasonal ups and downs. Economic conditions can affect all businesses. So, by having multiple income sources we are protecting our own financial future. In addition, one business may really take off and provide the opportunity to become truly financially independent. Having several sources of revenue is a good thing. It can help you enjoy a great retirement lifestyle even if you don't have a huge nest egg.
Learn How to Write a Blog and Be an Affiliate Marketer
If you are going to become a blogger and affiliate marketer, I want to caution you. Don’t try this alone without training. I certainly didn’t. As I mentioned, I wrote blog articles for years, but my intent wasn’t to get people to purchase products that I recommended. I knew very little about affiliate marketing. Before we launched LifeStyleOver50.com I took a course.
Shirley found a couple online that are two of the top travel bloggers in the world. They offer an online course that teaches everything you need to know to begin a blog and become an affiliate marketer.
Do It Right the First Time
They teach you the simplest and best practices. You learn what platform to use, what plugins to use, and how to use them. They share with you the ways they built their affiliate marketing business from their travel blog. These tips are something it would have taken me years to learn on my own, if ever.
We would never have been able to produce this blog and begin our affiliate marketing business without this course. If you want to learn more about the course, you can attend a free webinar where they explain it all to you. You can then make the decision about whether the course is right for you.
You Can Enjoy a Great Retirement Lifestyle
When planning your retirement, the world truly is your oyster. You can live virtually anywhere and have the retirement lifestyle you desire. All it takes is finding an incredible location that has everything you want. What you’ve learned here is that there are places in the world that cost a lot less than you thought.
And, if you need more money to retire to your ideal location, you can earn start earning that money now. And, continue to earn more in retirement. Hopefully, we gave you some important and valuable information here. More importantly, we opened-up your mind to possibilities. You can retire your way and enjoy a great retirement lifestyle even if you don't have a huge nest egg.