Retire early, live abroad until 65 and come back

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WhiteMaxima
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Retire early, live abroad until 65 and come back

Post by WhiteMaxima » Wed Aug 02, 2017 4:24 pm

According to https://www.numbeo.com/cost-of-living/comparison.jsp
Living abroad is cheaper than in US
I am 50, married. Enjoy traveling and different culture. With saving around 1.5 mil in fore and aft-tax acount (three funds 40/40/20)
I am thinking about retire abroad until 65 when Medicare takes effective. Live on after tax savings at 1/2 or even 1/3 of US. One country every year. Sell everything in the US (no property tax), no car expense. Do Roth conversion every year to 15% bracket for zero cap gain tax on aft-tax account. Pay cash for health care (same quality of service at 1/2 or even 1/3 of US). At 65, back to US to claim Medicare.
What's BH thought?

JBTX
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Re: Retire early, live abroad until 65 and come back

Post by JBTX » Wed Aug 02, 2017 4:41 pm

What are you going to live on while abroad? Does that come out of the $1.5 million?

Seems a little light but that totally depends on how much you spend.

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mhc
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Re: Retire early, live abroad until 65 and come back

Post by mhc » Wed Aug 02, 2017 4:42 pm

Which countries are on your short list?

I guess if you get ill abroad and you really need US doctors, you could come back and get ACA insurance. Keep your income low, and the government will subsidize your insurance.

anonsdca
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Re: Retire early, live abroad until 65 and come back

Post by anonsdca » Wed Aug 02, 2017 4:45 pm

I am planning to live abroad when I retire so I would like to participate in this thread. This has long been my plan so I have researched this from a lot of vantage points. I know where I am going and I know the general costs. I also know the culture and have spent significant time there already. I will even have extended family where I end up.

You talking about 15 years. If you sell everything and have no address here in the USA, research FACTA. Most banks and brokerage houses will close/freeze/sell your assets if they discover you no longer live in the US. Plenty of stories out there so do some research.

Also, why would you return for Medicare since your leaving for "same quality" cheaper health care? I happen to agree with you that this is the case, but why come back for Medicare? That doesn't make sense.

What people have told me is go visit, make sure you like living abroad. It's different. I have done that and I happen to love it. I find more freedom, less aggravation.

Good luck. Hope to hear from AlohaJoe.

WhiteMaxima
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Re: Retire early, live abroad until 65 and come back

Post by WhiteMaxima » Wed Aug 02, 2017 4:52 pm

Euro nations, Southeast Asia. All more afforadable than US. Healthcare cost is just a fraction even compare to ACA cost. All these nationals are small but with different culture and rich in history. I believe between 50 to 65 is the golden year in human life: health, wealth, willingness to explore. The usefulness of money is nonlinear during human lifespan.

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seed4great
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Re: Retire early, live abroad until 65 and come back

Post by seed4great » Wed Aug 02, 2017 5:55 pm

This might be a good idea, but please don't forget about taxes. In addition to US tax, you would need to pay local tax in every country you live. Typically, it is 183 days rule. Many countries has tax treaties with US, but tax return will get really complicated (you can check my blog at http://seed4great.com/index.php/2017/07 ... ing-abroad). Also, there will be a problem with US credit and debit cards, which may not be always possible to send overseas. While opening foreign account may not be possible for US citizens, due to FATCA regulations. Another problem is about brokerage accounts, which may require US home address. Finally, health care in many European countries for example is still expensive and you would need to buy private insurance. I'm not saying it is impossible, but definitely can get really complicated.
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blueblock
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Re: Retire early, live abroad until 65 and come back

Post by blueblock » Wed Aug 02, 2017 6:01 pm

I remember reading an expat's blog back in the early 2000s about his experiences moving from LA to Costa Rica. (It's no longer on line.) As he told it, he had loved his (low-paying) career in theater arts, and moved to CR to stretch his SS. Mostly, he loved it. But some specific downsides he mentioned are worth recounting:
- Friends say they'll come visit, but few actually do; he wasn't quite prepared for the feeling of isolation versus his previous life
- Despite taking Spanish lessons, and striking up conversations as often as possible, real fluency came slowly
- And that affected his ability to make local friends, so loneliness was an issue for many months, though it got better and made him treasure friendships more than he might have
- He got what he called "foreigner fatigue"—when everything is new, nothing is familiar, and that takes a psychological toll. One example I remember, he found himself longing for a Starbucks coffee, even though he didn't like Starbucks much when he lived in LA. As he recognized, what he craved was simply something familiar.

There are, of course, expat communities where one can mingle with "familiar" folks. My blogger chose to live in an area where there wasn't one. He said that they weren't his "tribe."

Anyhow, just some possible food for thought.

freebeer
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Re: Retire early, live abroad until 65 and come back

Post by freebeer » Wed Aug 02, 2017 6:13 pm

WhiteMaxima wrote:According to https://www.numbeo.com/cost-of-living/comparison.jsp
Living abroad is cheaper than in US
I am 50, married. Enjoy traveling and different culture. With saving around 1.5 mil in fore and aft-tax acount (three funds 40/40/20)
I am thinking about retire abroad until 65 when Medicare takes effective. Live on after tax savings at 1/2 or even 1/3 of US. One country every year. Sell everything in the US (no property tax), no car expense. Do Roth conversion every year to 15% bracket for zero cap gain tax on aft-tax account. Pay cash for health care (same quality of service at 1/2 or even 1/3 of US). At 65, back to US to claim Medicare.
What's BH thought?
Yes, I think an interesting plan. What is your level of expected SS benefits? And what do you see as your expected annual spending both during the 15 years abroad and afterwards back in US? The answers to these two questions should determine whether 1.5M at age 50 is plausibly enough.

Also what does your spouse think?

WhiteMaxima
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Re: Retire early, live abroad until 65 and come back

Post by WhiteMaxima » Wed Aug 02, 2017 6:26 pm

I have company pension at 30k per year. That will last me quite well in Thailand between 65 and 70 1/2 when I will claim SS at $3400 /month. I guess I would complete Roth conversion by 70 1/2. Until then I have no RMD just SS and pension. Between now to 70 is truly a golden era for traveling, exploring and learning.

adamthesmythe
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Re: Retire early, live abroad until 65 and come back

Post by adamthesmythe » Wed Aug 02, 2017 6:35 pm

> when I will claim SS at $3400 /month

Check to see how this is calculated. It may assume that you continue to earn the same salary until full retirement age.

If you have 35 years of earnings in already you should be good.

It is an interesting plan although one I wouldn't have had the courage to use. But then my job was fine- not so great that I wanted to keep it after 65, but fine until then.

Barefootgirl
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Re: Retire early, live abroad until 65 and come back

Post by Barefootgirl » Wed Aug 02, 2017 8:00 pm

This is not really unusual is it? In the area where I live, many people from other countries come to the U.S., obtain residency status - earn & save/accrue a boatload of $$$, then return to their home countries and live out their remaining years as kings and queens of the neighborhood.

I would think it is easier for US born people who are open minded, find it easy to pick up new languages and find a community they fit in wherever they land.

What's not to like? all you have to lose here in the US is a life ruled by many regulations...
How many retired people does it take to screw in a lightbulb? Only one, but he takes all day.

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bligh
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Re: Retire early, live abroad until 65 and come back

Post by bligh » Wed Aug 02, 2017 8:07 pm

Financially it can work depending on your choice of country.

The real question is whether you are certain you will enjoy it. Some people would find living abroad really difficult and tedious, others would not only be able to do it, they would thrive and may not even want to return. Which end of the spectrum are you closer to?

Diogenes
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Re: Retire early, live abroad until 65 and come back

Post by Diogenes » Wed Aug 02, 2017 8:15 pm

WhiteMaxima wrote:According to https://www.numbeo.com/cost-of-living/comparison.jsp
Living abroad is cheaper than in US

One country every year. Sell everything in the US (no property tax), no car expense. Do Roth conversion every year to 15% bracket for zero cap gain tax on aft-tax account. Pay cash for health care (same quality of service at 1/2 or even 1/3 of US). At 65, back to US to claim Medicare.
What's BH thought?
Lots of threads on this sort of thing. One country per year will require multiple longterm visas, which are likely only possible to apply for while you are in the States. How do you know you will get the same standard of health care?
If you have current health issues you will likely not get those visas in the more desirable places, as they often require a physician letter and/or proof of medical insurance in the package.
Suggest that you prepare a short list, making sure to exclude those that are wanting a larger guaranteed income source (i.e. a pension more than $30k) and visit each place first for at least a few weeks. You refer to 'Euro nations' being cheaper than the U.S. for cost of living. That hasn't been my experience.

AlohaJoe
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Re: Retire early, live abroad until 65 and come back

Post by AlohaJoe » Wed Aug 02, 2017 10:22 pm

WhiteMaxima wrote:According to https://www.numbeo.com/cost-of-living/comparison.jsp
Living abroad is cheaper than in US
I have lived abroad for many years. I would take that calculator with a grain of salt. You will not be able to live on 1/2 or 1/3 of the US unless you change your style of living dramatically...but you could do that in the US too.

I think the overall idea of living outside the US is fine, obviously. I think your plan doesn't make much sense as it stands. You need to refine it, do more research, and think harder about what kind of future life is actually possible and enjoyable.

What country is going to let you live there for a year? They all require visas. The Schengen visa means you get to spend 90 days there before you have to leave.

Spending a year in a country means you become subject to their taxes and will have to figure out how they work.

Moving every year while abroad means you will never have any friends.

Few people who are over 50 enjoy an itinerant lifestyle like that. Even people who enjoy travel often (but not always) "get it out of their system" after a while and find themselves traveling less.

Moving back to the US after 15 years abroad means you will have no friends in the US.

If you don't have a car expense how are you going to get around in these other countries? Are you going to buy a scooter in Southeast Asia and drive that everywhere? Are you going to take a taxi everywhere?
Pay cash for health care (same quality of service at 1/2 or even 1/3 of US).
Have you ever sought medical care in a place where their English wasn't 100% perfect in explaining what's wrong with you and what they're doing to fix it? Are you comfortable with that?

If not, you probably will be paying more than you expect to go to the international/expat clinics. As an example, I went to an expat-friendly dentist and my tooth cleaning and check up was $90 cash. I went to a dentist who spoke broken English and didn't know all the right words for medical things and I got a root canal for $50.

Picking one country you love and figuring out how you're going to build a life for 10-20-30 years there is almost always a much better approach.

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Watty
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Re: Retire early, live abroad until 65 and come back

Post by Watty » Thu Aug 03, 2017 12:12 am

WhiteMaxima wrote:Living abroad is cheaper than in US
You need to compare that to very low cost of living areas in the US. Living in a desirable area of some other country may not save you as much as you are thinking when compared to living in someplace like a mid-west college town.

I toyed with the idea of living overseas too and a couple of things I remember from when I went through this were;

1) Most people will also need to budget for periodic trips back to the US to see friends and relatives and there may also be occasional expensive short notice flights back to the US for things like funerals and when relatives are critically ill. That can add up and reduce your overall savings.

2) If you are living in some place like Costa Rica, then you will likely want to spend time traveling around the country and seeing all the interesting things. When you are away from your home there the costs will add up if you want to do something like spend a week on the beach. A typical years housing cost could end up being $500 a month to rent an apartment and five nights a month(60 nights, or even more) in hotels. You will likely need to furnish wherever you live and that can add up and be a challenge when there is large stores and you do not speak the language. In some countries an apartment does not even come with light fixtures. That adds up.

3) When looking at the numbers consider the relative standard of living. If you try to maintain a typical US standard of living then the costs can go up a lot in some countries and be higher than what you see in cost of living surveys.

4) Consider if you will need a car where you are living. Outside of the most urban areas transportation can be an issue. Even in some place like Europe where there trains are usually very good, once you get away from the train station having a car could be necessary to see the countryside. Your US driver's licence may only be valid for a limited time and in some countries getting a drivers license can be very difficult and possibly expensive.

There are lots of good reasons for wanting the adventure of living in a different country but it would be best if the cost was a secondary factor.

ncbill
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Re: Retire early, live abroad until 65 and come back

Post by ncbill » Thu Aug 03, 2017 9:52 am

South of the border works very well for many USA expats, retired or not.

I was surprised at the number of expats in Mexico living on SS disability/SSI.

Annual residence visa requires showing regular income from pension/SS, but there are plenty of fixers available to handle the process for you.

Buy into their national health care for a few hundred bucks/year to serve as catastrophic health insurance.

Pay for a private "coverage everywhere but the USA" insurance policy or pay out of pocket for more routine health care needs.

Ricecakes
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Re: Retire early, live abroad until 65 and come back

Post by Ricecakes » Thu Aug 03, 2017 10:23 am

WhiteMaxima wrote:According to https://www.numbeo.com/cost-of-living/comparison.jsp
Living abroad is cheaper than in US
I am 50, married. Enjoy traveling and different culture. With saving around 1.5 mil in fore and aft-tax acount (three funds 40/40/20)
I am thinking about retire abroad until 65 when Medicare takes effective. Live on after tax savings at 1/2 or even 1/3 of US. One country every year. Sell everything in the US (no property tax), no car expense. Do Roth conversion every year to 15% bracket for zero cap gain tax on aft-tax account. Pay cash for health care (same quality of service at 1/2 or even 1/3 of US). At 65, back to US to claim Medicare.
What's BH thought?
I have been doing what you mention here for 5 years now and love the travel. Have lived in three different countries and enjoy learning the language and cultures of each. Financially speaking: Just be sure you run your numbers and are sure you have enough funds to last, same as planning to retire stateside. Banking, brokerage and credit cards easily dealt with using family or friends address for home address/ mail etc.

Quality of life: high quality care is available almost everywhere. Even developing countries have wealthy citizens; you will use the same doctors they will.
Agree with the comment that your friends may not visit, get used to Skype and FaceTime. Also plan on a trip home every year / year & half. There's just something about watching the Superbowl on Sun. night and not at 6 a.m. :happy

Just a note about Numbeo cost of living. Much of your expenses vary according to how you choose to live. If you try to maintain a lifestyle same as you have in the US, your COL will rise. Live more like a local- a well to do local- and your money will go further. Also you may wish to spend some time visiting before choosing to deciding to settle in one place. Your experience as a tourist vs resident will likely vary.

Just my two cents... :happy

WhiteMaxima
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Re: Retire early, live abroad until 65 and come back

Post by WhiteMaxima » Thu Aug 03, 2017 10:48 am

Ricecakes wrote:
WhiteMaxima wrote:According to https://www.numbeo.com/cost-of-living/comparison.jsp
Living abroad is cheaper than in US
I am 50, married. Enjoy traveling and different culture. With saving around 1.5 mil in fore and aft-tax acount (three funds 40/40/20)
I am thinking about retire abroad until 65 when Medicare takes effective. Live on after tax savings at 1/2 or even 1/3 of US. One country every year. Sell everything in the US (no property tax), no car expense. Do Roth conversion every year to 15% bracket for zero cap gain tax on aft-tax account. Pay cash for health care (same quality of service at 1/2 or even 1/3 of US). At 65, back to US to claim Medicare.
What's BH thought?
I have been doing what you mention here for 5 years now and love the travel. Have lived in three different countries and enjoy learning the language and cultures of each. Financially speaking: Just be sure you run your numbers and are sure you have enough funds to last, same as planning to retire stateside. Banking, brokerage and credit cards easily dealt with using family or friends address for home address/ mail etc.

Quality of life: high quality care is available almost everywhere. Even developing countries have wealthy citizens; you will use the same doctors they will.
Agree with the comment that your friends may not visit, get used to Skype and FaceTime. Also plan on a trip home every year / year & half. There's just something about watching the Superbowl on Sun. night and not at 6 a.m. :happy

Just a note about Numbeo cost of living. Much of your expenses vary according to how you choose to live. If you try to maintain a lifestyle same as you have in the US, your COL will rise. Live more like a local- a well to do local- and your money will go further. Also you may wish to spend some time visiting before choosing to deciding to settle in one place. Your experience as a tourist vs resident will likely vary.

Just my two cents... :happy
Thanks for your input. One question, how can you deal with long-term visa if you stay over 90 days. Do you still maintain a US base for coming back? How does living abroad impact to your budget (if you include flight back to from from US every year)?

coupleofcents
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Re: Retire early, live abroad until 65 and come back

Post by coupleofcents » Thu Aug 03, 2017 11:07 am

Thanks for your input. One question, how can you deal with long-term visa if you stay over 90 days. Do you still maintain a US base for coming back? How does living abroad impact to your budget (if you include flight back to from from US every year)?
I grew up in Thailand as an American and have spent a few years living there as an adult as well. Speaking for Thailand, many expats would do what we call a "border" run. So you come to Thailand on a 60 day tourist visa which is free. You can then extend for 30 more days by making a border run to a close land border country like Myanmar, Cambodia, Laos and then come right back into Thailand. After that you would have to exit the country to a place like Malaysia and fly back into Bangkok to start a new 60 day tourist visa.

Haven't been back for a few years so the rules may have a changed a little since then. Not sure about other countries. Otherwise you have to get a sponsor to apply for an non-immigrant visa meaning you are doing some kind of work etc. Those are for 1 year and cost money (I don't think more than a few hundred dollars if I remember correctly).

Ricecakes
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Re: Retire early, live abroad until 65 and come back

Post by Ricecakes » Thu Aug 03, 2017 11:22 am

WhiteMaxima wrote:
Ricecakes wrote:
WhiteMaxima wrote:According to https://www.numbeo.com/cost-of-living/comparison.jsp
Living abroad is cheaper than in US
I am 50, married. Enjoy traveling and different culture. With saving around 1.5 mil in fore and aft-tax acount (three funds 40/40/20)
I am thinking about retire abroad until 65 when Medicare takes effective. Live on after tax savings at 1/2 or even 1/3 of US. One country every year. Sell everything in the US (no property tax), no car expense. Do Roth conversion every year to 15% bracket for zero cap gain tax on aft-tax account. Pay cash for health care (same quality of service at 1/2 or even 1/3 of US). At 65, back to US to claim Medicare.
What's BH thought?
I have been doing what you mention here for 5 years now and love the travel. Have lived in three different countries and enjoy learning the language and cultures of each. Financially speaking: Just be sure you run your numbers and are sure you have enough funds to last, same as planning to retire stateside. Banking, brokerage and credit cards easily dealt with using family or friends address for home address/ mail etc.

Quality of life: high quality care is available almost everywhere. Even developing countries have wealthy citizens; you will use the same doctors they will.
Agree with the comment that your friends may not visit, get used to Skype and FaceTime. Also plan on a trip home every year / year & half. There's just something about watching the Superbowl on Sun. night and not at 6 a.m. :happy

Just a note about Numbeo cost of living. Much of your expenses vary according to how you choose to live. If you try to maintain a lifestyle same as you have in the US, your COL will rise. Live more like a local- a well to do local- and your money will go further. Also you may wish to spend some time visiting before choosing to deciding to settle in one place. Your experience as a tourist vs resident will likely vary.

Just my two cents... :happy
Thanks for your input. One question, how can you deal with long-term visa if you stay over 90 days. Do you still maintain a US base for coming back? How does living abroad impact to your budget (if you include flight back to from from US every year)?
Ok...visa: depends on the country. Again if you have spent time and are sure you want to stay long term, residency is an option in some places. For example countries like Malaysia(mm2h) , Thailand, Panama and Ecuador to name a few, have long term stay programs. With bank deposit/ income verification you can apply and receive a visa to stay long term- up to 10 years in some cases. Just check the visa requirements of the country you are interested in.
Many developing nations want to attract foreigners in the late 40s-50+ range; early retirees as they will spend their $$ in country.

TBH staying with multiple 90 day tourist visa only attracts attention of immigration nowadays. Best to use the 90 day visa to check out a country. If you like it, look into staying long term, if you don't, move on to the next place.

I use my relatives home as a US base. They collect any mail for me and also use their home for banking/ brokerage address. A few souvenirs and a couple of bottles of local the booze usually keeps them happy. Also I stay with them when I come home :happy
Lastly to stay on budget you will need to include the cost of travel back however often you choose to do so. For me once a year works, others may vary. Where you decide to stay will affect the cost of your tickets so that must be part of your decision making process. Hope this helps...

neilpilot
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Re: Retire early, live abroad until 65 and come back

Post by neilpilot » Thu Aug 03, 2017 11:26 am

Some countries will issue a permanent visa if you can substantiate an income source such as SS or pension. Ecuador's Pensioner’s Visa is an example: For this visa you have to justify a monthly income of at least $800 for one person and $100 more per dependent, if you are coming with your family. The income that you will receive monthly has to be proved with a certification from the entity that will pay you the income such as Social Security.

The cost of the visa may have increased since I last looked.

snowman
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Re: Retire early, live abroad until 65 and come back

Post by snowman » Thu Aug 03, 2017 11:36 am

I don’t see a problem with your plan, the obstacles mentioned in replies are just details to be worked out. The major problem you face is your spouse – is she on board? If she is not, that’s the end of it.

michaeljc70
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Re: Retire early, live abroad until 65 and come back

Post by michaeljc70 » Thu Aug 03, 2017 12:13 pm

I just saw this today:

https://www.cnbc.com/2017/08/03/the-wor ... ntary.html

Interesting list. Not what I would have expected. I've been to Malta, Budapest, France and Italy (though not the city listed) and didn't think they were cheap.

WhiteMaxima
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Re: Retire early, live abroad until 65 and come back

Post by WhiteMaxima » Thu Aug 03, 2017 12:19 pm

Spain issues golden visa if a foreign family invest 500kEuro. After 5 years, you get permanent euro residence.

alaskantraveler
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Re: Retire early, live abroad until 65 and come back

Post by alaskantraveler » Thu Aug 03, 2017 1:44 pm

There are a lot of great responses in this post that I second.

A few other things to note.

I am in 30s. My gf(now wife) and I were under employed for about 3 1/2 years and traveled long term to 30 countries in Europe, Asia, and the Americas. We love to travel, we are open minded, we love to experience new cultures, cuisine, etc...

A few things I began to realize after traveling long term. Eventually the allure of traveling isn't enough. When you've seen some of the world's greatest temples, greatest buildings, greatest museums, greatest churches, greatest natural wonders, most beautiful beaches the next visit just doesn't give you the same pleasure/utility... whatever you want to call it... as it once did.

Living somewhere just because it offers a lower cost of living may be appealing at first, but will get old. You have to travel with some purpose or to pursue some kind of activity that you find fulfilling other than just traveling. Whether you want to volunteer, dive, trek, write, sport, teach, learn, start a business, you need something. When I'm in my office, the idea of relaxing on a tropical beach somewhere drinking a pina colada sounds great, but after 3 days of laying on a beach doing nothing but soaking up the sun will start to get old.

As others have said, cost of living even abroad comes down to lifestyle. I think the cheaper cost of living abroad gets overstated. There are many good places to live in the USA where you can rent a one bedroom apartment for $500/month. Owning an inexpensive used car can cost less than $200/month, and food can be had for $500/month. Add a cell phone bill and some miscellaneous, and you can reasonably live a modest lifestyle in places in the USA on less than $2000/month. Yes you can also live in Thailand for $2000.

coupleofcents
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Re: Retire early, live abroad until 65 and come back

Post by coupleofcents » Thu Aug 03, 2017 1:53 pm

alaskantraveler wrote:There are a lot of great responses in this post that I second.

A few other things to note.

I am in 30s. My gf(now wife) and I were under employed for about 3 1/2 years and traveled long term to 30 countries in Europe, Asia, and the Americas. We love to travel, we are open minded, we love to experience new cultures, cuisine, etc...

A few things I began to realize after traveling long term. Eventually the allure of traveling isn't enough. When you've seen some of the world's greatest temples, greatest buildings, greatest museums, greatest churches, greatest natural wonders, most beautiful beaches the next visit just doesn't give you the same pleasure/utility... whatever you want to call it... as it once did.

Living somewhere just because it offers a lower cost of living may be appealing at first, but will get old. You have to travel with some purpose or to pursue some kind of activity that you find fulfilling other than just traveling. Whether you want to volunteer, dive, trek, write, sport, teach, learn, start a business, you need something. When I'm in my office, the idea of relaxing on a tropical beach somewhere drinking a pina colada sounds great, but after 3 days of laying on a beach doing nothing but soaking up the sun will start to get old.

As others have said, cost of living even abroad comes down to lifestyle. I think the cheaper cost of living abroad gets overstated. There are many good places to live in the USA where you can rent a one bedroom apartment for $500/month. Owning an inexpensive used car can cost less than $200/month, and food can be had for $500/month. Add a cell phone bill and some miscellaneous, and you can reasonably live a modest lifestyle in places in the USA on less than $2000/month. Yes you can also live in Thailand for $2000.
Very interesting points. I think the reason so many people like to travel, have a dream to travel, live abroad etc (including me sometimes) is that it is exciting. We associate the 1 week trip to Paris or the 2 week trip around Southeast Asia we did while working regular jobs in the U.S. as the same experience we would have if we lived abroad or constantly traveled. But if you are traveling all the time you probably just adapt to that and things would begin to feel like a burden... applying for visas, dealing with another language, etc.

I've thought about early retirement and living abroad but my thinking has changed to where I believe we will settle in the U.S. nearer to family, and have enough money to travel occasionally as we want to. This will keep it fresh.

Sorry OP, if I went off on my own musings here.

Rupert
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Re: Retire early, live abroad until 65 and come back

Post by Rupert » Thu Aug 03, 2017 2:04 pm

coupleofcents wrote:
Very interesting points. I think the reason so many people like to travel, have a dream to travel, live abroad etc (including me sometimes) is that it is exciting. We associate the 1 week trip to Paris or the 2 week trip around Southeast Asia we did while working regular jobs in the U.S. as the same experience we would have if we lived abroad or constantly traveled. But if you are traveling all the time you probably just adapt to that and things would begin to feel like a burden... applying for visas, dealing with another language, etc.

I've thought about early retirement and living abroad but my thinking has changed to where I believe we will settle in the U.S. nearer to family, and have enough money to travel occasionally as we want to. This will keep it fresh.

Sorry OP, if I went off on my own musings here.
+1. The grass always appears greener. But when you live some place a while, any place, you start to notice all the little things about that society that annoy you. They'll likely be different from the little things that annoy you about the US, but they'll still annoy you. Someone upstream mentioned something about the freedom of living without regulations. If a place is fit to live in, there are regulations. You don't often experience them as a tourist because countries try really hard not to annoy tourists. But you'll definitely experience them if you live there.

J295
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Re: Retire early, live abroad until 65 and come back

Post by J295 » Thu Aug 03, 2017 2:26 pm

Personally, I would not have my decisions on where to live be based principally on health care and other costs (note: under current law OP may be able to manage MAGI to have health care premium costs that are less than premium costs in other countries).

Mr.BB
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Re: Retire early, live abroad until 65 and come back

Post by Mr.BB » Thu Aug 03, 2017 4:33 pm

If you want some really good Insights on living abroad in different countries one of my favorite sites is
http://www.bestplacesintheworldtoretire.com
You can get a lot of your answers questions about various countries from people who actually live there.
"We are what we repeatedly do. Excellence, then, is not an act, but a habit."

WhiteMaxima
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Re: Retire early, live abroad until 65 and come back

Post by WhiteMaxima » Thu Aug 03, 2017 4:35 pm

What if living abroad expense is 1/2 of the cost in the US? That could extend your saving more than twice as long.

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Re: Retire early, live abroad until 65 and come back

Post by jlawrence01 » Thu Aug 03, 2017 5:22 pm

There are literally THOUSANDS of YouTube videos produced by American expats living in countries around the world. These are people who are living in the country and who at times, are receiving health care in the various countries. Quite often, these videos include scenes from the local hospitals You will find that in many locations that the health care that is a fraction of the price of US health care may not meet your standards as a US consumer.

Don't believe me. Start watching some of the videos.

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Re: Retire early, live abroad until 65 and come back

Post by ThankYouJack » Thu Aug 03, 2017 5:29 pm

jlawrence01 wrote:There are literally THOUSANDS of YouTube videos produced by American expats living in countries around the world. These are people who are living in the country and who at times, are receiving health care in the various countries. Quite often, these videos include scenes from the local hospitals You will find that in many locations that the health care that is a fraction of the price of US health care may not meet your standards as a US consumer.

Don't believe me. Start watching some of the videos.
Yep, this is a good blog with a numbers like expenses - http://wagonersabroad.com/ . I forget what total spend is for the year, I want to say around $40k -- not bad for a family of 4 and all the travel!

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Re: Retire early, live abroad until 65 and come back

Post by aristotelian » Thu Aug 03, 2017 5:35 pm

WhiteMaxima wrote:I have company pension at 30k per year. That will last me quite well in Thailand between 65 and 70 1/2 when I will claim SS at $3400 /month. I guess I would complete Roth conversion by 70 1/2. Until then I have no RMD just SS and pension. Between now to 70 is truly a golden era for traveling, exploring and learning.
Can you live on pension and SS in retirement? That would enable you to spend your $1.5M savings between now and SS. $100K per year, you could do just fine in Thailand I would think.

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Re: Retire early, live abroad until 65 and come back

Post by anonsdca » Thu Aug 03, 2017 5:58 pm

jlawrence01 wrote:There are literally THOUSANDS of YouTube videos produced by American expats living in countries around the world. These are people who are living in the country and who at times, are receiving health care in the various countries. Quite often, these videos include scenes from the local hospitals You will find that in many locations that the health care that is a fraction of the price of US health care may not meet your standards as a US consumer.

Don't believe me. Start watching some of the videos.
Yes, there are. That is where your real info will come from. Just pick a place and you will find a community of vloggers. Even with this, need to visit before doing anything.

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Re: Retire early, live abroad until 65 and come back

Post by jlawrence01 » Thu Aug 03, 2017 6:34 pm

anonsdca wrote:
jlawrence01 wrote:There are literally THOUSANDS of YouTube videos produced by American expats living in countries around the world. These are people who are living in the country and who at times, are receiving health care in the various countries. Quite often, these videos include scenes from the local hospitals You will find that in many locations that the health care that is a fraction of the price of US health care may not meet your standards as a US consumer.

Don't believe me. Start watching some of the videos.
Yes, there are. That is where your real info will come from. Just pick a place and you will find a community of vloggers. Even with this, need to visit before doing anything.

And you have to take some of their estimates of the cost of living with an enormous grain of salt. For example, several vloggers prepare "budgets" of how much it costs to live in their country of residence but they exclude a number of expenses - health insurance, trips home, emergencies - to name a few. Also, make sure that you are understand how they are living. One vlogger in the Philippines only spends $1k per month BUT lives in a 4th floor, 200 square room in building without hot water with his wife and teen-aged daughter. Sure, it is cheaper there than in Chicago BUT it is not an "apples to apples" comparison.

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Re: Retire early, live abroad until 65 and come back

Post by Katietsu » Thu Aug 03, 2017 6:56 pm

I would think that moving each year would make healthcare insurance very challenging. You may be able to self insure for a broken ankle. However, how would you handle catastrophic coverage? For instance. at age 62, my seemingly very healthy FIL was diagnosed with a condition that required what, at that time, was $18,000 a month of prescription drugs. Discounting for a foreign country but adjusting for inflation, I suspect this would be in the six figures every year regardless of what country you are in.

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Re: Retire early, live abroad until 65 and come back

Post by anonsdca » Thu Aug 03, 2017 7:48 pm

jlawrence01 wrote:
anonsdca wrote:
jlawrence01 wrote:There are literally THOUSANDS of YouTube videos produced by American expats living in countries around the world. These are people who are living in the country and who at times, are receiving health care in the various countries. Quite often, these videos include scenes from the local hospitals You will find that in many locations that the health care that is a fraction of the price of US health care may not meet your standards as a US consumer.

Don't believe me. Start watching some of the videos.
Yes, there are. That is where your real info will come from. Just pick a place and you will find a community of vloggers. Even with this, need to visit before doing anything.

And you have to take some of their estimates of the cost of living with an enormous grain of salt. For example, several vloggers prepare "budgets" of how much it costs to live in their country of residence but they exclude a number of expenses - health insurance, trips home, emergencies - to name a few. Also, make sure that you are understand how they are living. One vlogger in the Philippines only spends $1k per month BUT lives in a 4th floor, 200 square room in building without hot water with his wife and teen-aged daughter. Sure, it is cheaper there than in Chicago BUT it is not an "apples to apples" comparison.

Totally agree JL, Ia familiar with that Vlogger, because that is my destination. :D Everything should be taken with a grain of salt, but those Vlogs provide a wealth of information you cant not get on a forum. I just encourage the OP to search YouTube as you have suggested. Also, spend time there.

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Re: Retire early, live abroad until 65 and come back

Post by AlohaJoe » Thu Aug 03, 2017 7:52 pm

Katietsu wrote:I would think that moving each year would make healthcare insurance very challenging. You may be able to self insure for a broken ankle. However, how would you handle catastrophic coverage? For instance. at age 62, my seemingly very healthy FIL was diagnosed with a condition that required what, at that time, was $18,000 a month of prescription drugs. Discounting for a foreign country but adjusting for inflation, I suspect this would be in the six figures every year regardless of what country you are in.
You just buy international health insurance. It doesn't cost six figures every year. It would cost $5,780 a year with a $1,000 deductible to get complete coverage.

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Re: Retire early, live abroad until 65 and come back

Post by Katietsu » Thu Aug 03, 2017 9:03 pm

Katietsu wrote:
I would think that moving each year would make healthcare insurance very challenging. You may be able to self insure for a broken ankle. However, how would you handle catastrophic coverage? For instance. at age 62, my seemingly very healthy FIL was diagnosed with a condition that required what, at that time, was $18,000 a month of prescription drugs. Discounting for a foreign country but adjusting for inflation, I suspect this would be in the six figures every year regardless of what country you are in.
AlohaJoe wrote:
You just buy international health insurance. It doesn't cost six figures every year. It would cost $5,780 a year with a $1,000 deductible to get complete coverage.
Top
The six figure reference was to the potential ongoing medical costs if you were diagnosed with the wrong illness. But it is interesting to know that a international policy can be procured for such a reasonable rate. I was aware of short term policy for overseas travel but did not realize you could have purchase a policy in the individual market that would cover you indefinitely internationally.

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Re: Retire early, live abroad until 65 and come back

Post by Barefootgirl » Thu Aug 03, 2017 9:50 pm

You just buy international health insurance. It doesn't cost six figures every year. It would cost $5,780 a year with a $1,000 deductible to get complete coverage.
Do you have a link for this?
How many retired people does it take to screw in a lightbulb? Only one, but he takes all day.

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Re: Retire early, live abroad until 65 and come back

Post by halfnine » Sun Aug 06, 2017 5:02 pm

I'll just note a few comments

Kramer and AlohaJoe always provide great advice in these type threads.

Quality healthcare can be obtained abroad in many countries for reasonable prices. And, for those in search of a global insurance plan, I used IMG Global for many years.

Yes, people can live just as cheap in some places in the USA. But, it really comes down to what you value. Beachfront, good weather, eating out, maid service, etc. There are many places in the world where these lifestyle choices are cheaper than can be found in the USA.

Maybe people do fly back to the USA every year so it is a cost to think about. But, then again, I haven't flown back to the USA in the last 8 years.

If you're thinking permanent residence in Europe after 5 years, I'd think again about the strategy. Five years is a long commitment, absences have to be minimal during that time frame, and permanent residency is typically lost if you leave afterwards for a year or two. Without citizenship you really don't have any real guaranteed permanence as many of the EU natives in the UK are finding out.

Time zones matter. The more time zones between you and the USA the harder it is to maintain contact with friends, family.

As has been previously mentioned one year stints aren't really going to work out. What many people do in the beginning is spend 3-6 months in a country and then head on to the next country often chasing the favorable seasons and avoiding visa/taxation issues. In this pattern you would live in 2-3 countries each year. And then each year going back to the same countries while maybe swapping out a new one for an old one every year. So, if you want some variety, it might be something you could do from 50-55. After that you will probably want to stay in one country for many years at a time.

Finally, expect inflation to be greater abroad than in the USA. Over the last 20 years there has certainly been a boom in expat centered lifestyles. But, with it costs have increased and with it the requirements required for residency as well. Certainly, many countries I could have expatriated to 20 years ago I can forget about now. I expect that trend to continue and for cheaper countries to become more expensive and for the most desirable countries to become impossible to get residency in.

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Re: Retire early, live abroad until 65 and come back

Post by staythecourse » Sun Aug 06, 2017 7:46 pm

WhiteMaxima wrote:Euro nations, Southeast Asia. All more afforadable than US. Healthcare cost is just a fraction even compare to ACA cost. All these nationals are small but with different culture and rich in history. I believe between 50 to 65 is the golden year in human life: health, wealth, willingness to explore. The usefulness of money is nonlinear during human lifespan.
This could be a thread upon itself. I believe Mr. Swedroe. Mr. Ferri, or Mr. Clement talked about this in one of their books that retirement is really divided into 3 parts... early, middle, and late. The three are different as the needs financially are different in each part. The early expendeurens are the highest as folks do A LOT of travel. The middle is less as folks start having healthcare needs and/ or they have fulfilled all their exploration wants. The last is when folks don't spend much money at all due to having one or both spouses with health issues or one is already dead.

So, in the end, yes the point of useful of money is nonlinear seems to be correct and one aspect of investing/ retirement that is not discussed.

Good luck.

p.s. I agree 50-65 seems to be the sweet spot when it comes to travel. Also because many kids have not started with their families, i.e. grandchildren.
"The stock market [fluctuation], therefore, is noise. A giant distraction from the business of investing.” | -Jack Bogle

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Re: Retire early, live abroad until 65 and come back

Post by VictoriaF » Mon Aug 07, 2017 4:43 am

In addition to the financial, medical, and social considerations be realistic about the time and effort it takes to select a country, a town, an apartment, and various local services. Even the preliminary research of visiting all the sites and watching all the videos recommended in this thread will takes months. It's conceivable that all your time would be spent on administrative issues leaving no time for la dolce vita.

A better alternative, in my opinion, is to choose one country as the base and travel from there. If you have a good healh insurance in the U.S., create the base there. You can choose it in a state with no state income tax. If you need health insurance, make your base in one country abroad. I would consider the 2nd largest city in a Central European country, such as Brno in the Czech Republic or Krakow in Poland. You can live there less expensively than in the capital, live without a car, and be well connected to the rest of Europe.

You will need to take language courses, but that has advantages of making local friends and warding off mental decline.

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Re: Retire early, live abroad until 65 and come back

Post by ncbill » Mon Aug 07, 2017 6:32 am

Many 65+ US expats choose to keep paying for Medicare, then return to the U.S. for expensive procedures (i.e. transplant)

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Re: Retire early, live abroad until 65 and come back

Post by cherijoh » Mon Aug 07, 2017 7:21 am

WhiteMaxima wrote:Euro nations, Southeast Asia. All more afforadable than US. Healthcare cost is just a fraction even compare to ACA cost. All these nationals are small but with different culture and rich in history. I believe between 50 to 65 is the golden year in human life: health, wealth, willingness to explore. The usefulness of money is nonlinear during human lifespan.
Euro nations? Right now they may be cheaper because of the favorable exchange rate, but that is in no way guaranteed - especially in the long term. As recently as 2008 it cost almost $1.60 to buy 1 Euro. See historical Euro/Dollar exchange rates here. Can you tolerate that much volatility in your purchasing power? Also I have found that in Europe (just like the US) there is a huge difference in the cost of living between the big cities (where most of the jobs are) and the more rural areas. Are you envisioning living in a metropolitan/cosmopolitan area or a sleepy backwater? Also once you are outside the big cities the number of adults in your age group who are fluent in English will decrease dramatically, making life a lot more isolating (and sometimes frustrating on the day-to-day living front) unless you are multi-lingual - especially if you follow your plan to move to a new country every year.

Also are you sure that you'd be eligible for subsidized healthcare in Europe as a non-citizen? I believe they have been cracking down on benefits for immigrants because of the influx of refugees.

SE Asia may be a different kettle of fish since I believe costs ARE less expensive (again outside the biggest cities), but are you ready for that much of a culture shock?

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Re: Retire early, live abroad until 65 and come back

Post by cherijoh » Mon Aug 07, 2017 7:39 am

adamthesmythe wrote:> when I will claim SS at $3400 /month

Check to see how this is calculated. It may assume that you continue to earn the same salary until full retirement age.

If you have 35 years of earnings in already you should be good.

It is an interesting plan although one I wouldn't have had the courage to use. But then my job was fine- not so great that I wanted to keep it after 65, but fine until then.
If OP is going by his standard SS statement, it DOES assume that he'll keep working at an equivalent salary until he starts benefits - unless they changed it since the last time I checked. At 50, that could mean a few years of zeros (or very low wages from PT jobs). Also presumably the OP is now in what are considered peak earning years which contribute significantly to the overall benefit.

OP - you have to dig into the SS website to get a more accurate estimate, but it can be done.

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Re: Retire early, live abroad until 65 and come back

Post by WhiteMaxima » Mon Aug 07, 2017 2:12 pm

VictoriaF wrote:In addition to the financial, medical, and social considerations be realistic about the time and effort it takes to select a country, a town, an apartment, and various local services. Even the preliminary research of visiting all the sites and watching all the videos recommended in this thread will takes months. It's conceivable that all your time would be spent on administrative issues leaving no time for la dolce vita.

A better alternative, in my opinion, is to choose one country as the base and travel from there. If you have a good healh insurance in the U.S., create the base there. You can choose it in a state with no state income tax. If you need health insurance, make your base in one country abroad. I would consider the 2nd largest city in a Central European country, such as Brno in the Czech Republic or Krakow in Poland. You can live there less expensively than in the capital, live without a car, and be well connected to the rest of Europe.

You will need to take language courses, but that has advantages of making local friends and warding off mental decline.

Victoria
Maintain a US base, you would eliminate the cost saving: You will have to pay two places. I would sell everything in the US or put in stroage. The property taxe saving is enough for me to rent an apt in Brno. The purpose of living abroad: 1) explore new world 2) reduce living expense (by withdraw from your before-tax up to 15% tax rate). Brno and Krakow are good choice. From map, Brno is just hrs away to Wien. US passport allows 60 days stay. Might just take a weekend visa trip to Crotia.
Last edited by WhiteMaxima on Mon Aug 07, 2017 2:17 pm, edited 1 time in total.

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Re: Retire early, live abroad until 65 and come back

Post by WhiteMaxima » Mon Aug 07, 2017 2:15 pm

cherijoh wrote:
WhiteMaxima wrote:Euro nations, Southeast Asia. All more afforadable than US. Healthcare cost is just a fraction even compare to ACA cost. All these nationals are small but with different culture and rich in history. I believe between 50 to 65 is the golden year in human life: health, wealth, willingness to explore. The usefulness of money is nonlinear during human lifespan.
Euro nations? Right now they may be cheaper because of the favorable exchange rate, but that is in no way guaranteed - especially in the long term. As recently as 2008 it cost almost $1.60 to buy 1 Euro. See historical Euro/Dollar exchange rates here. Can you tolerate that much volatility in your purchasing power? Also I have found that in Europe (just like the US) there is a huge difference in the cost of living between the big cities (where most of the jobs are) and the more rural areas. Are you envisioning living in a metropolitan/cosmopolitan area or a sleepy backwater? Also once you are outside the big cities the number of adults in your age group who are fluent in English will decrease dramatically, making life a lot more isolating (and sometimes frustrating on the day-to-day living front) unless you are multi-lingual - especially if you follow your plan to move to a new country every year.

Also are you sure that you'd be eligible for subsidized healthcare in Europe as a non-citizen? I believe they have been cracking down on benefits for immigrants because of the influx of refugees.

SE Asia may be a different kettle of fish since I believe costs ARE less expensive (again outside the biggest cities), but are you ready for that much of a culture shock?
I would buy Euro Bond and stock fund to hedge the currency risk.

cherijoh
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Re: Retire early, live abroad until 65 and come back

Post by cherijoh » Mon Aug 07, 2017 4:18 pm

WhiteMaxima wrote:
cherijoh wrote:
WhiteMaxima wrote:Euro nations, Southeast Asia. All more afforadable than US. Healthcare cost is just a fraction even compare to ACA cost. All these nationals are small but with different culture and rich in history. I believe between 50 to 65 is the golden year in human life: health, wealth, willingness to explore. The usefulness of money is nonlinear during human lifespan.
Euro nations? Right now they may be cheaper because of the favorable exchange rate, but that is in no way guaranteed - especially in the long term. As recently as 2008 it cost almost $1.60 to buy 1 Euro. See historical Euro/Dollar exchange rates here. Can you tolerate that much volatility in your purchasing power? Also I have found that in Europe (just like the US) there is a huge difference in the cost of living between the big cities (where most of the jobs are) and the more rural areas. Are you envisioning living in a metropolitan/cosmopolitan area or a sleepy backwater? Also once you are outside the big cities the number of adults in your age group who are fluent in English will decrease dramatically, making life a lot more isolating (and sometimes frustrating on the day-to-day living front) unless you are multi-lingual - especially if you follow your plan to move to a new country every year.

Also are you sure that you'd be eligible for subsidized healthcare in Europe as a non-citizen? I believe they have been cracking down on benefits for immigrants because of the influx of refugees.

SE Asia may be a different kettle of fish since I believe costs ARE less expensive (again outside the biggest cities), but are you ready for that much of a culture shock?
I would buy Euro Bond and stock fund to hedge the currency risk.
You would need to check that whatever fund you were looking at wasn't hedging the currency risk for the domestic consumer. I believe many funds do so.

Re Vanguard International Bond Index Fund:
fund is also subject to additional risks, such as country/regional risk. The fund employs currency hedging strategies to protect against uncertainty in future exchange rates, so investment returns are expected to reflect the underlying performance of international bonds.

WhiteMaxima
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Re: Retire early, live abroad until 65 and come back

Post by WhiteMaxima » Mon Aug 07, 2017 5:17 pm

US passport can only stay 90 days out of 180 days. Short stay means high travel and rent expense. Stay more than 180 during a year you are subjected to hefty EU taxes.

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