Asia Caught Off Guard by Its Aging Population

This is a guest commentary for CNBC.com.

There are significant changes under way in the global economy. The continuing rise of emerging markets is one. Aging populations is another. The latter is gripping not just developed markets, such as Japan and Europe, with possibly dire consequences for financial stability and growth.

In parts of emerging Asia, populations are graying rapidly as well. These countries are equally ill-prepared to face the challenge.

Dale Durfee | Getty Images

China is probably the most worrying. Partly as a result of the country's one-child policy — initiated in 1977 and rolled out nationwide two years later — its demographic turn will be abrupt. By some estimates, the labor force will start to contract in 2015. After years of expanding rapidly, which goes a long way toward explaining the economy's breath-taking growth over the last three decades, this will amount to an outright jolt.

The numbers speak for themselves. Currently, China has approximately 137 million people aged 65 or above. In 12 short years, this will balloon by another 100 million. The ratio of retirees to income earners will jump from 49 percent currently to 69 percent in 2030, assuming that the retirement age remains the same. By 2035, the median age in China will have increased from 35 to 45 years — equal to Japan's median age currently.

But China is not alone. South Korea's working-age population will also begin to shrink in 2015. Taiwan has already seen a sharp rise in the ratio of retirees to income earners, while the country's median age is projected to climb from 37 currently to 56 in 2050, which will make it the oldest population in Asia. Hong Kong and Singapore face similarly daunting demographics — although, in both cases, immigration could yet help mitigate the problem. Even Thailand is past its demographic prime, with the labor force expected to start contracting within the next 10 years.

Diminishing Demographic Returns

There are a number of ways in which aging affects growth. First, a declining labor force throttles economic dynamism. This is particularly true in Asia, where the demographic dividend has for years been a potent driver of economic expansion. For these economies to maintain their accustomed speed, every remaining worker would have to become a lot more productive.

Second, consumption patterns tend to change. People consume the most between ages 20 and 40. As populations age, therefore, household spending tends to cool as well, a situation that poses a challenge to countries trying to rebalance their economies away from exports and investment. Sharply rising incomes can go a long way toward delaying the slowdown in consumption that aging inevitably entails. But that brings its own set of problems, including rising inflation pressures, especially if productivity fails to accelerate.

Third, demographics can have a powerful impact on savings. People tend to accumulate a nest egg over their working lives. Particularly between the ages of 40 and 65, saving rates peak in anticipation of retirement. But, thereafter, it swiftly begins to drop, with savings being drawn down. Japan is already well into this process: its household saving rate has fallen from solid double digits in the 1990s to a rate below that of the United States. In South Korea, too, the saving rate has already started to plummet. With fewer savings available, investment ultimately becomes more costly, making it harder still to maintain economic growth.

Fourth, rapidly aging populations put significant strain on the public finances. Healthcare costs soar and, if not sufficiently accrued in prior years, so does spending on pensions. This can mean an ever higher tax burden on the working population, dampening growth. The IMF, for example, estimates that aging-related public sector costs will climb on average by 4.1 percent of GDP in China and by 7.8 percent in South Korea over the next 10 years, some of the highest such adjustments required in the world.

Act Now or…

Policymakers will need to act, fast, to prepare for Asia's demographic turn. Provisions will have to rise, financed through taxes and direct contributions. Every effort, too, must be made to spur productivity growth to wean the economies off labor force growth as a driver of economic expansion. Debt should be held in check as well, if only because the cost of capital will inevitably begin to rise. Higher interest rates will make even existing, let alone new, borrowing far harder to finance.

Investors, too, should be mindful. It is easy to be gripped by the vagaries of economic numbers released from one month to the next. But something far larger is going on. Parts of Asia face similar aging problems as Europe and Japan. So far, no economy has succeeded in maintaining rapid growth when populations grow old. If this process is managed well, it need not spell doom. But the right tracks will need to be laid at once. Fortunately, there are other countries still waiting in the wings with young and hungry populations. India and the Philippines, for instance, will not have to grapple with such challenges for decades to come.

Frederic Neumann is co-head of Asian Economics at HSBC's Global Research and has been covering regional economies for the past 7 years. He is a regular guest on CNBC TV.

Original Link URL: http://www.cnbc.com/id/49472132

Retirement Communities in Asia

Throughout the Western world, the ‘retirement home’ or village, as it’s often known, has grown from a fringe retirement choice into one of the most popular options for retirees seeking a stable post-working life in relative comfort. Affordable and built to provide a high standard of living for retirees without the means or desire to live on their own, they provide a useful service that’s made them particularly popular.

Unfortunately, however, the concept of a retirement home or community hasn’t caught on in Asian countries. Many retirees in these countries either live on their own in a standard home or apartment, or choose to live with their families as part of their larger household.

At its core, this contrast in retirement living comes down to the culture of Asia and the West. While Western countries value individuality and autonomy dearly, Asian societies – particularly East and Southeast Asian cultures – place a huge amount of importance on keeping families close together. As a result, many retirees don’t like the idea of living on their own, even as part of a greater retirement community.

As a result, there are relatively few retirement communities in Asia, at least very few aimed at local residents. The appeal of family life and a culture that stresses being a close-knit family unit has made them culturally unappealing. However, a growing community of Western retirees and expatriates exists in many Asian countries – a potential ‘retirement community’ of sorts for those planning to retire to Asia.

Over the last two decades, retirement hotspots have popped up all over Asia. These regions, colloquially known as ‘grey zones,’ have grown in popularity over the past ten years as greater numbers of Westerners pack their bags and move to Asia. Many coastal towns and small communities in countries such as Thailand and Malaysia are now hotspots for Western retirees seeking a better life overseas.

A classic example of this phenomenon can be seen in Hua Hin, a small beach city on the Gulf of Thailand. Just two hours south of Bangkok by road and a short one-hour journey by air, this charming and quiet beach city has grown into one of Thailand’s biggest immigrant hotspots. Its primary residents: Western retirees and families that left their own countries in search of a more peaceful, inexpensive lifestyle.

The success of Hua Hin as a retirement community is unquestionable. The city was once a small town dependent on domestic tourism and agriculture. Today, it’s one of the country’s most well-known beach resorts and a hotspot for tourists and retirees alike. The economy has grown substantially and both locals and retirees are reaping the benefits of a healthy economy and comfortable climate.

Located far away from the vices and big business that make Bangkok a stressful city, Hua Hin is a classic example of a ‘retirement bubble’ popping up in a country that’s otherwise primarily known for short-term tourism.

Other emerging retirement hot spots are popping up in Penang, a small island off the coast of Malaysia, and Phuket, one of Thailand’s biggest tourist destinations and a growing destination for retirees seeking an inexpensive tropical lifestyle.

While these retirement communities differ from the typical Western retirement village in many ways, they offer the same sense of comfort and familiarity that can be important when retiring to a foreign country. There are no walls or locked gates to keep intruders out – they aren’t necessary because of the region’s low crime rate and inexpensive security staff.

Likewise, there are no care staff or offices to manage the place – only maids and domestic staff that can be hired independently, often at prices far below those that you would see in the West. Overall, life in a retirement hotspot in Asia tends to be a more independent experience that’s much more fulfilling and fun for retirees.

All in all, the retirement experience in countries such as Thailand and Malaysia is much more independent than life in a retirement community in the West. But at the same time, however, it offers more value for retirees.

Rather than living in a modest space and having every aspect of their lives managed, retirees in Asia have a higher level of purchasing power and autonomy, allowing them to manage their own lives and hire help when it’s required.

While the lack of formal retirement villages in Asia may be upsetting to those that seek comfort and a more ‘managed’ type of life, it’s a boon for those that would like their post-working years to be more convenient and comfortable, yet every bit as independent and free as their prior life.

For this reason, life in a retirement community or ‘retirement hotspot’ in many parts of Asia is often a better choice for would-be retirees than a more managed life close to their home. The pleasant weather, the inexpensive cost of living, and the level of autonomy they can experience can add fulfillment and adventure to a retirement life that would otherwise be dull and uninteresting.

Original Link URL: http://www.retireinasia.com/retirement-communities-in-asia/

Need for Retirement Village - The Star (Malaysia)

I READ the article titled Lost soul of the old, by Q (Star2, Oct 19) with trepidation because what every senior citizen fears most is being forced to stay in a nursing home.

Such homes are for those who need some assistance in their daily living.

There is very little difference between one nursing home and another because in most homes – usually housed in bungalows in towns and housing estates – two or more senior persons are cramped into one room without any personal space for privacy. Often, there is no provision for recreation, relaxation and interaction.

Placed in such an environment, the feeling of abandonment and isolation becomes even more acute, especially when loved ones fail to show up as promised. This diminishes the will of the elderly to live.

Nowadays, most families are facing hard times. Children who have elderly parents have to work harder to make ends meet. Sometimes, the shortage of maids means that they have no choice but to send their old folks to nursing homes.

If such homes can provide part of the solution for families today, why not revamp and improve them to provide better health care for the senior residents?

In Australia, there are retirement homes, villages and resorts. Each one offers basic facilities like food, lodging and some form of personal health care, but different levels of luxury, comfort and care, the choice of which depends on one’s ability to pay.

As living in a retirement village (RV) is a relatively new concept in this country, I shall elaborate.

The RV concept: It is a community of retirees who would like to stay together for mutual assistance and interaction. Residents are still capable of taking care of themselves and each RV should be able to house about 50 residents.

Ideally the RV should be located within reach of a town, and be near to a hospital, and shopping and other facilities.

Residents: The RV should be able to accommodate three categories of people: independent residents who can look after themselves and interact with their peers; the low-care group which may require some assistance (they can opt for hostel-type accommodation and share common utilities like the kitchen and washroom), and the high-care group, which is not capable of taking care of themselves (often, they need nursing and have to be bathed and fed).

Operations: An RV project requires more than the pooled resources of all the residents. Ideally someone from outside, such as a big company or a welfare organisation, can provide assistance as part of its corporate social responsibility programme.

To run the RV smoothly, you need an accountant/administrator to collect money, pay the bills and keep the accounts.

There should also be another paid employee, such as a driver/carer/handyman who is on hand to replace a lamp bulb, drive residents to the shopping centre, or render help should someone fall ill.

Facilities: A cafeteria is an essential part of the RV so that residents who do not wish to cook can have their meals there.

Arrangements should be made with a local barber/hairdresser to visit the RV at least twice every month to help residents with hair care and grooming.

Some residents may need a physiotherapist to work on their muscles and stiff joints. Arrangements should also be made with a local doctor to visit the RV whenever he is needed.

There should be a small plot of land beside each individual housing unit for independent residents of the RV, as gardening is a form of therapy and an essential part of holistic, healthy living.

For the convenience of residents, the RV should provide a shuttle bus service at least thrice weekly, to places like the supermarket, bank and shopping complex. Independent residents who are still able to drive should be encouraged to keep their cars.

To serve a thriving community of retirees, the RV should have a multi-purpose hall that can accommodate about 80 people.

Residents and guests can gather there to celebrate the New Year, birthdays and festivals. The hall can also be used for lectures and worship services, or rented out for private functions.

If the RV caters for low- and high-care residents, there should be a sick bay with the proper equipment. In case of a medical emergency, staff at the sick bay can render first aid before the resident is transferred to a hospital.

For recreation, the RV should have a small gymnasium equipped with basic exercise machines, and tennis and badminton courts.

Careful planning and implementation are necessary to make the retirement village a workable reality.

These are just some of my thoughts on the subject and more thinking, modification and refinement are needed. Perhaps other readers would like to share their input.

Original URL Link: http://thestar.com.my/lifestyle/story.asp?file=%2F2011%2F12%2F14%2Flifefocus%2F10080476&sec=lifefocus#.TzUvOrKL5ag.blogger

Time For Some Decent Retirement Home Projects – The Star (Malaysia)

By The Star,  5 May 2012

RAPID changes in the lifestyle and affluence of the people are heralding changes in their way of life. Promoting new lifestyle concepts and ideas in our property landscape should be part of this whole change process to enliven our living space.

The living, working/study, and recreational landscapes need to keep up with these myriad changes to bring about a higher standard of living and way of life for the people.

Although residential projects are now better designed and built, there is still room for improvement and growth. We can certainly make use of more value adding projects that promote higher quality of life in keeping with the people’s higher affluence; and these projects will also add depth to the market.

It is perplexing that after all these years, we still do not have lifestyle projects that are dedicated to retirees; or retirement villages that are built to cater to people who have retired from the work force.

A recent chat with some “retired” friends invariably touched on why after all these years, there are still no specially-built retirement villages for them and our senior citizens.

They pointed out that despite having so many development projects under way and on the drawing board in many parts of the country, none has came up with a retirement village in their project plans.

One of the reasons for the disinterest for such projects could be the misconstrued belief that old folks homes are the same as retirement homes, and that they are not lucrative projects to pursue.

There may also be a worry of a lack of interest for such facilities in view of the fact that the extended family tradition is still widely practised in our society. Unlike in the western societies who are accustomed to the concept of staying in retirement homes, their eastern counterparts usually prefer to stay put in their own home or move in with their grown-up children when they have reached retirement age.

It may also be because of a lack of expertise in such specialised projects as a retirement village is still a relatively new concept here. What we need is a gutsy developer to team up with an established operator of retirement villages to promote some landmark projects to get the concept off to a flying start in Malaysia.

We have to realise that the number of retirees who are opting to stay independently on their own is on the rise as a result of lifestyle changes.

Preferably they should be located in some nice suburbs with abundance of fresh clean air, lush greenery and yet are relatively close to civilisation and the basic amenities.

Although a good number of our senior folks can still fall back on their grown up children to take care of them, many are choosing to live independently for as long as they can.

There are various reasons for this to enjoy their freedom to live independently the way they want, while not be a burden to their children.

There is in fact a big market for such retirement homes and it should pay off handsomely for developers that start to seriously plan for properly designed and dedicated retirement villages for our retired folks.

It is about time we have properly designed retirement villages for them given that their number is on the rise and more of them have the means to enjoy a fruitful and rewarding lifestyle way into their twilight years.

As the country ages, so does its citizens. After all these years of toil and hard work, they deserve to live the rest of their life in a safe, pleasant and comfortable ambience.

The onus is on developers to study some of the more successful retirement schemes overseas and “localise” the projects by incorporating features and facilities that are tailor-made for the local populace. One of the all time favourites, I believe, will be kicking off with a mature fruit orchard beaming with durian, rambutan and mangosteen trees.

First and foremost, the champion for the maiden retirement village scheme in the country should get the objectives and design right from the start – a retirement home does not equal an old folks’ home.

An old folks’ home is basically an institution or home that accepts elderly people to stay for a fee, and usually these homes are fitted with some rather basic facilities such as food, lodging and helpers.

On the other hand, a retirement village is a colony of retirement homes that has been purposefully designed and equipped, as well as furnished and fitted with all the proper facilities, environment and ambience, to cater to the special needs of this special group of people. They may have retired but are still fit and healthy to pursue their hobbies and interests.

It is built within a safe and secure environment that is close to amenities, and come complete with a wide range of facilities that meet the needs of its residents.

These units can either be independent units for those who are still fit and healthy and can still take care of themselves, or catered units for people who need care and attention. They should be equipped with facilities that promote a healthy and enriching lifestyle such as gymnasium, swimming pool, laundrette, library, and elderly friendly features such as ramps for wheelchairs and healthcare providers.

These residences are usually available for sale or long leases. But rental should be discouraged because the very reason for opting to stay in a retirement village is for its security and community living, which may be compromised by the presence of the “short term” residents.

Deputy news editor Angie Ng knows many ways in which developers can fulfil their corporate social responsibility and one of the evergreen ways is to keep abreast of the needs of the old and young alike by making their developments user friendly and relevant for the people.

By The Star

Original Link URL: http://biz.thestar.com.my/news/story.asp?file=/2012/5/5/business/11220687&sec=business

The Three Stages of Retirement

In his book “The Prosperous Retirement, Guide to the New Reality”, Michael Stein, CFP, describes three stages of retirement:

1. Active retirement — the ‘Go-Go’ stage

“These activities also may result in expenditures that are well above the budget on which the retiree lived before retirement. If this seems surprising, reflect on how much you spend while traveling on vacation versus what you spend when you are at home in a more normal routine. After a while, reality generally takes over, things settle down to a less frenetic pace, and an active, satisfying, and thoroughly enjoyable stage of retirement begins. The budget during this active stage of retirement generally is equal to the pre-retirement budget; in fact, that is:

Stein’s First Rule of Retirement - The active-stage retirement budget tends to equal the pre-retirement budget, if the retiree can afford it.

People generally want to continue the same life-style after retirement that they enjoyed before retirement. This lifestyle will cost about the same amount during retirement that it did before retirement. I know that this flies in the face of conventional wisdom, but it is true. There will be more discussion of why this is true in Chapter 3. During the years of the active stage, inflation will continue to act on the budget and drive it just as it did before retirement, but then a change begins to happen.

2. Passive retirement — the ‘Slow-Go’ stage

The “go-go” stage of retirement gives way to the “slow-go” stage. After some years of active retirement, people begin to grow weary of long vacations, feel less than enthusiastic about running through airports and train stations, grow tired of living out of suitcases on trips, and, in general, decide to let the pace of their lives slow down. This is the beginning of the passive stage of retirement.

The transition from active retirement to passive retirement generally begins when retirees reach the mid-70s and it lasts for about 10 years. There is no social science study to verify this observation, but watching hundreds of retirements has led me to this conclusion. Sometimes people feel like traveling and being active well into their 80s. Sometimes deteriorating health causes people to slow down before they reach their 70s.

Typically most people are able to be about as active as they want until their 70s, then, inexorably, old age creeps up on us and we slip quietly, without trauma, into the passive retirement stage. These older people take fewer and fewer trips and then, ultimately, no trips. They buy no new cars, no new houses. In fact, this may be the time that people downsize their homes, purchase fewer new clothes, and allow a quieter and less expensive lifestyle to take over. During the years of the passive stage, the budget typically declines by 20 to 30%, but the decline may be masked by the upward push of inflation.

3. Final retirement — the ‘No-Go’ stage

Finally, the quiet pleasures give way to the unpleasant realities of the third stage of retirement, the final stage. The “slow-go” stage gives way to the “no-go” stage. Failing health makes medical treatment and nursing care the defining characteristics. This stage may be prolonged or it may be blessedly brief. Managing this uncertainty is one of the principal challenges of The Prosperous Retirement and is discussed in more detail in Chapter 9.”

Original Link URL: http://blunckfinancial.com/planning/retirement%20-%20stages.htm

Retirement Homes in SE Asia

Southeast Asian countries are evolving as ideal retirement destinations. Jon Gorvett writes about the various sops these countries have to offer, to woo the elderly population.

With Southeast Asian countries from Vietnam to Indonesia promoting themselves as ideal retirement destinations, the old and not-so-old are being courted vigorously by the region’s economic developers. This wooing also has created a niche market for real estate, from retirement villages in the Philippines to apartments and bungalows suitable for the elderly in Thailand and Malaysia.

“There are around 1,00,000 people across Asia who have retired to the region from elsewhere, but it’s really hard to say exactly,” said Andrew Ness, executive director of CBRE Research Asia in Hong Kong, a division of the CB Richard Ellis real estate agency. “Thailand is the big apple though, with everyone basically trying to pinch market share from there.”

Thailand among the first

Thailand was the first country in Southeast Asia to start courting retirees. “People came here backpacking in the 1960s and ’70s, then brought their kids in the ’80s and ’90s,” said James Pitchon, executive director of CBRE Thailand.

Junaida Lee, deputy secretary general of the Malaysian Tourism Ministry, said, “It’s the baby boomers we are targeting. They are top priority — those from the West, such as the UK and from Japan too.”

Home or Japanese retirees

Japanese retirees also have been pursued by the Philippines, where a $10 million retirement village is being planned for elderly Japanese on Tablas, an island in Romblon Province about 350 kms south of Manila. Sakura Retirement Investments of Japan announced the 40-villa project in October, last year saying it would be built by Smart Ventures, an Australian developer.

The complex is to include a Japanese restaurant, a private beach, a gym and sauna centre and its own security staff as well as a nurse assigned to each villa. Medical facilities are among the key factors in attracting retirees. “One reason why Phuket in Thailand has taken off as a place for retirement is that it has pretty good hospitals,” Ness of CBRE Research Asia said.

Malaysia Program

Malaysia says it has attracted about 12,700 participants since it started a retiree program called Silver Hair in 2002. It introduced Malaysia My Second Home in 2006. “Retirees and other long-stay residents spend much more than tourists,” Lee said. Participants are required to have minimum income levels, depending on their age. For example, anyone older than 50 years must have 350,000 ringgit or $104,000 in assets; a monthly pension of 10,000 ringgit, which may be deposited into Malaysian banks tax-free and must keep 150,000 ringgit in a fixed-interest account. A third of that deposit can be withdrawn after one year.

In exchange, participants get a 10-year resident’s visa and permission to work as many as 20 hours a week. They also gain the right to buy property, subject to state laws. And, while buying real estate is not mandatory, “Accommodation is very cheap in Malaysia,” said Steve Collins, a retiree from Enfield, a town in Middlesex north of London, who joined the Second Home program. “For £50,000 you can buy a very good home outside Kuala Lumpur.”

The housing stock in the suburb, which is popular with expatriates for its restaurants and golf courses, typically consists of low-rise condominium buildings constructed in the past 20 years, villas and semi-detached houses. Prices are typically about 700 to 800 ringgit a square foot. “I think the cost of living here is about one-third of what it is in the US or Japan,” said Toshiyuki Niwa, a Japanese-American who retired to Malaysia in 2007 after working for the United Nations for 37 years. “This is a definite plus,” he added.

Going Thai

In Thailand, the financial qualifications for the foreign retiree program are a deposit of 800,000 baht ($24,000) and a monthly income of 65,000 baht, regardless of age. Participants then receive a one-year visa, which can be renewed. Thai real estate laws state that only 49 per cent of the units in any apartment building may be owned by foreigners, regardless of whether they are members of the country’s retiree program. Although, foreigners are not permitted to own land.

Philippines, Vietnam…

In the Philippines, the Special Resident Retiree Visa Program is available to any foreigner 35 years or older. A deposit of $50,000 is required for anyone younger than 50 years; $20,000 for anyone older. Anyone accepted in the program gets permanent resident status and can deposit his pension in a Philippine bank tax-free. But the Philippines, too, bans foreign ownership of land.

Vietnam has also begun promoting retirement options, although, “Vietnam is a little immature as a market for this,” said Ness of CBRE Research Asia.

He explained, “Their resort property is mainly aimed at the Vietnamese themselves.” Looking at the region in general, “Malaysia offers a much more attractive legal package,” Pitchon of CBRE Thailand said.

Original URL Link:  http://www.deccanherald.com/content/52065/retirement-homes-se-asia.html

The 18 Best Places to Retire Overseas

When choosing a place to spend your retirement years, the cost of living is important. But it is only one consideration. The ideal retirement spot is a place where you can live a rich life filled with friends, travel, discovery, physical and intellectual distractions, and opportunities for growth. A super-low cost of living is great, but more important is the quality of life your retirement budget is buying you.

Many of the best options for enjoying an enormously enriched retirement lifestyle on even a very modest budget can be found overseas. Here are the world’s 18 top retirement havens, where an interesting, adventure-filled lifestyle is available for a better-than-reasonable cost.

The Americas

1. Panama. 

Panama is the world’s top retirement haven. Panama City no longer qualifies as cheap, but other spots in this country certainly do. Panama continues to offer the world’s gold standard program of special benefits for retirees. The currency is the U.S. dollar, so there is no exchange rate risk if your retirement savings and income is in dollars. The climate in Panama City and on the coasts is tropical, hot, and humid. However, the climate in the highlands can be temperate and tempting. Panama is the hub of the Americas, meaning it’s easily accessible from anywhere in North and South America and Europe.

2. Belize. 

Belize is a great place for reinventing your life in retirement. This tiny, under-developed, sparsely populated country offers two distinct lifestyle options: Ambergris Caye is the best of the Caribbean at a discount, while the Cayo is a frontier where independent-minded pioneers can make their own way and do their own thing, peacefully and privately. The climate is tropical, warmer on the coast, and cooler in the mountainous interior. The official language is English, so there’s no foreign language barrier for Americans. You’ll find a well-established and welcoming community of expats in San Pedro and on Ambergris Caye, and an emerging community of expats in the Cayo around San Ignacio.

3. Colombia. 

Medellin, a city of springtime and flowers, is the unsung jewel of Colombia. This city is pretty, sophisticated, cosmopolitan, safe, and affordable. Perhaps the most appealing advantage in Medellin is the cost of real estate. It’s an absolute global bargain. You can buy property in a good neighborhood for as little as $1,000 per meter.

Medellin’s second biggest appeal is its climate, which is spring-like year-round, thanks to the high elevation. Medellin is a more developed city than you might imagine, with five of the best hospitals in Latin America, universities, museums, art galleries, and an efficient and reliable metro system. It also has international-standard shopping and many interesting nightlife options. If you fancy Paris or other Continental city choices, but don’t want or can’t afford Europe, I strongly recommend you take a look at Medellin. This city is one of the best places in the world to hang your hat.

4. Uruguay. 

It seems that the more troubled the rest of the world becomes, the more people are finding appeal in Uruguay, a stable commodity-based economy with a sound banking system. Uruguay is neither an aggressor nor a target of aggression in the world arena, and it’s not a high-stakes player in world politics. Costs have risen in recent years thanks to the strength of the Uruguayan peso and the sinking value of the dollar. But, even as the cost of living and of real estate rose, Uruguay has become even more popular as a lifestyle and retirement destination. Accordingly, people are coming to Uruguay in record numbers, with residency applications up over 300 percent since 2007, many of these coming from the United States.

5. Ecuador. 

Ecuador is perhaps the best choice in the Americas for a retiree looking to enjoy a rich and interesting quality of life on a limited budget. I recommend Cuenca, the former Inca and Spanish capital, a current UNESCO World Heritage Site, and the intellectual heart of Ecuador. Cuenca is home to about 1,500 full-time residents from North America. This is not a big number compared with some more recognized Mexican retirement choices, but Cuenca clearly qualifies as an expat-friendly city, offering one of the most interesting retirement lifestyles available anywhere. Amenities include theater, orchestra, shows, restaurants, broadband Internet service, reliable electricity and telephone, and drinkable tap water.

Cuenca’s appeal as a retirement haven is expanding in important ways, thanks to a recently developed program promoting the city as a medical tourism destination. The city’s five top hospitals have joined together to offer bundled programs of medical tests, procedures, and services available for from $66 to $401. Costs for comparable services in the United States would be multiples of these amounts. In addition, Cuenca is now offering nursing care of a standard suitable for and appealing to the expat retiree at a cost of just $450 per month, including 24-hour doctor and nurse attendance, food, laundry, personal care, and occupational and rehabilitative therapy.

6. Nicaragua. 

Another top choice for a retiree with a very limited budget is Nicaragua. This country’s Pacific coastline is every bit as dramatically beautiful as that of neighboring Costa Rica. Infrastructure is under-developed in both countries, but the cost of living and especially real estate are noticeably lower in Nicaragua, making the pot-holed roads easier to bear. Nicaragua also boasts two of the top Spanish-colonial cities in the Americas: Granada, a pretty and romantic city that everyone should see once, and Leon. Both places were founded in the early 16th century by Cordoba.

7. Roatan, Honduras. 

I’m not a big fan of mainland Honduras, which is under-developed and, in some places, unsafe. However, the Bay Island of Roatan is a world apart and one of my two top picks for affordable retirement in the Caribbean (the other is Ambergris Caye, Belize).

8. Argentina. 

Argentina is a dynamic and charming nation that rides perpetually between crisis and boom. This rich country boasts abundant natural resources and offers many appealing retirement lifestyle choices, including the eclectic and cosmopolitan neighborhoods of Buenos Aires, the provincial capitals, a finca in the countryside, and a boutique vineyard in Mendoza. Retirement life in Argentina could be many things, but never dull. The downside is a rising cost of living, thanks to local inflation and the falling value of the U.S. dollar versus the Argentine peso.

9. Mexico. 

This is historically one of the most recognized retirement havens for Americans. But Mexico today is suffering from a lot of bad press thanks to its drug wars. However, Mexico is a big country, and the drug goons haven’t overtaken it entirely. It continues to offer some of the best coastal lifestyle and retirement options in the Americas, including Puerto Vallarta, my number-one choice for an affordable life of luxury on the Pacific. A couple could enjoy a a five-star retirement in this beautiful and romantic coastal town of marinas, golf courses, yacht clubs, and fine dining on a budget of as little as $2,500 per month.

10. Chile. 

Chile is a developed, First World destination that is also quiet, safe, and stable. Unlike its more scandalous neighbor, Argentina, Chile offers a cultured, comfortable lifestyle that is relatively calm. Santiago is a city of classic-style architecture, cobblestoned streets, and cafes with outdoor seating, in many ways reminiscent of Paris or Barcelona. This city of 7 million is also remarkably clean and friendly and boasts a diverse and expanding property market that is affordable on a global scale. You could own property at some of the city’s best addresses for less than $2,000 a meter. One important downside to retirement in Santiago is the air pollution, which is a serious problem, especially during the winter months. A better option could be the country’s beautiful Lake District to the south of Santiago, which is a favorite retirement choice among Chileans themselves.

Europe

11. France. 

France is a land of superlatives. Its capital has been called the most beautiful, most romantic, and most touristed city on earth. It also boasts some of the world’s best wines, cheeses, restaurants, shopping, castles, gardens, parks, beaches, museums, cafes, galleries, vineyards, and architecture. The typical concern for anyone who has ever dreamed of a new life in France is that it’s too expensive for the average retiree to consider seriously. Not so. Paris isn’t cheap. But elsewhere in France you can find realistic options, even if your retirement budget is modest. Perhaps the most retirement friendly region in this country is in the southwest, north of Spain, where small country towns offer a way of life that is quintessentially French and also very affordable.

12. Italy. 

The cost of living in Rome, Florence, Venice, and Tuscany might be beyond the limits of your retirement budget. But that doesn’t mean you should take Italy off your list entirely if this is the country that stirs your imagination and speaks to your soul. A retiree on a budget interested in Italy could look at Abruzzo. From this beautiful Old World base, within a half-day’s drive of both the coast and the mountains, you could plan excursions to Italy’s better-known and more expensive outposts as often as you liked.

13. Ireland. 

Americans have long dreamed of retirement on the Emerald Isle and with good reason. Ireland is safe, peaceful, relaxed, welcoming, friendly, hospitable, and English-speaking, making it an ideal retirement choice for many. Ireland today is also more affordable than it has been in more than a decade, and its property market has fallen off a cliff. Real estate prices are down 50 percent or more in many markets and are still falling. If you, like so many others, have dreamed of wiling away your retirement years on your own little piece of the Auld Sod, this could be the best time in your lifetime to think about making that purchase.

14. Spain. 

Spain is known among expats for its Atlantic and Mediterranean coastlines, especially its infamous (and unfortunately over-developed) Costa del Sol. But there’s more to this country than its costas. Barcelona, for example, is a world-class city on the ocean, perfect if you’re looking for a cosmopolitan life near the water. Real estate prices in this country have fallen tremendously since the highs of four or five years ago. If retirement in Spain appeals to you, this could be the time to search for a great deal on Spanish retirement digs.

15. Croatia. 

Croatia, a country with an extraordinarily complicated history and an extremely open-minded, forward-looking population, is at another turning point in its long history. Countries at turning points are interesting places to be. I recommend the country’s Istrian Peninsula, which serves up some of the most delightful scenery on the planet. The land seems to rise up to embrace you, and everywhere you look, something nice is growing like olives, grapes, figs, tomatoes, pumpkins, blackberries, and wildflowers. Even the buildings seem to be part of the earth, built of its white stone and red clay. This sun-soaked region offers one of the most appealing lifestyle options in Europe today.

Asia

16. Thailand. 

Thailand boasts both really cheap and developed and comfortable lifestyle choices. It is also noteworthy as being one of the few countries in this part of the world that offers formal options for long-term and retirement visas. Hua Hin is one of the few classic retirement havens in Southeast Asia, complete with golf courses, factory outlets, and gated communities. Foreigners make up approximately 15 percent of that population, and most of them are retired. With 12 golf courses in operation and another 3 under construction, this is definitely the place to go if you’re a golfing enthusiast. Hua Hin is a place where, if you were so inclined, you could live a North American lifestyle and never have to involve yourself more than superficially with the local Thai culture. This could be a plus or a minus for you, but it is worth noting when discussing options in this typically exotic part of the world.

17. Vietnam. 

While Thailand is well-established as an interesting option for expats and foreign retirees, Vietnam is an emerging choice, which could get a lot more attention in the coming few years. Nha Trang offers an interesting coastal retirement option for adventuresome retirees. Nha Trang’s total population of more than 200,000 includes an expat population of about 1,000 people, meaning foreigners here are still pioneers. You’ll find no organized activities for foreigners, such as expat clubs or softball leagues. The lack of a big foreign population makes it easier to have meaningful interactions with the locals. The major attraction in Nha Trang is its cost of living, which can amount to much less than $1,000 per month for a retired couple. If you’re a budget-minded retiree with an interest in Asia, this town should be on top on your list.

18. Malaysia. 

After Thailand, Malaysia is the easiest country to navigate in this part of the world. The country’s capital, Kuala Lumpur, is a city of contrasts. The shining stainless steel Petronas Towers, two of the tallest skyscrapers in the world, anchor a startlingly beautiful skyline that is truly unique to this city. Modern, air-conditioned malls flourish, selling everything from beautifully handcrafted batik clothing to genuine Rolex watches and Tiffany jewelry. In the shadows of these ultra-modern buildings, the ancient Malay village of Kampung Baru still thrives, with free-roaming roosters and a slow pace of life generally found in rural villages. Less than a 20-minute walk from the city center, you can find yourself conversing with monkeys in the city-jungle surrounding one of the highest telecommunications towers in the world. A walk of less than 30 minutes leads you to Chinatown and Little India, where merchants offer their wares, foods, and culture in happy neighborhoods that showcase the amazing diversity of the city.

Unlike some places in Asia, foreigners are genuinely welcomed in Kuala Lumpur. Language isn’t a problem, as almost everyone speaks adequate English. Immigration is easy, and it is possible to stay for an extended period with a simple tourist visa. Although Kuala Lumpur is more expensive than rural Malaysia, it can be marvelously inexpensive by Western standards. You can realistically expect to cut your living expenses by a third and still enjoy a lifestyle comparable to what you are accustomed to now.

Kathleen Peddicord is the founder of the Live and Invest Overseas publishing group. With more than 25 years experience covering this beat, Kathleen reports daily on current opportunities for living, retiring, and investing overseas in her free e-letter. Her book, How To Retire Overseas—Everything You Need To Know To Live Well Abroad For Less, was recently released by Penguin Books.

Original Link URL: http://money.usnews.com/money/blogs/On-Retirement/2012/03/19/the-18-best-places-to-retire-overseas