The U.S. economy is continuing its freefall, and the quality of life for millions of people is being threatened by a financial climate heading toward even riskier terrain. Cost of living is rising, retirement savings is declining, and the expected payoff for many homeowners has been dramatically reduced. According to Barry Golson, author of Retirement Without Borders, and editor of Forbes Traveler, “Surveys have shown that as many as four out of five baby boomers have not saved enough for a comfortable U.S. retirement, and the latest figures indicate a national savings rate approaching zero. (In Japan, it is 20 percent.)” An increasing number of people are looking past the borders of their home country for new opportunities. Proper research and finding a network of people who are living overseas can help to make an informed decision. It is likely that you will find people who are experiencing a retirement that is socially and intellectually fulfilling, while also maximizing their savings. The purpose of this article is to highlight the steps that can be taken right now to find a location that will offer a more rewarding future.
Exodus
Many well-known financial experts, such as Steve Bergsman; and investors such as legend Henry Kaufman, are beginning to look overseas for opportunities that have vanished in the U.S. and most of the developed nations. This is a good indicator for the retiree or second homebuyer; wise investors choose locations that are stable, experiencing rising tourism, and show economic strength.
The rate at which American citizens are leaving the United States has risen sharply over the past five years to reach record numbers today. Expatriate Americans now number around 4 million, and the exodus does not seem to be slowing down—if you are considering an overseas move, you definitely will not be alone. Certainly, the reasons for this could be political or financial, but from the many expats we know, the reasons are more likely to be rooted in a desire for new experiences, an intense thirst for knowledge, and an open mindedness about foreign lands and cultures. It is the richness of experience, a healthier physical climate, and a lower cost of living that has forced many people to conclude that they have not sacrificed anything to live outside their country of birth; in fact, these expats overwhelmingly report that they have attained a better quality of life where a dramatically reduced pace of life has offered them the chance to enjoy every day to its fullest. Combine day-to-day quality of life with a 50% cost-of-living reduction, and it is no wonder why more and more people are thoroughly enjoying retirement overseas.
Good Weather Ahead
There is mounting evidence to suggest that the financial climate for most of the world is entering a Japanese-style "lost decade." Trend forecasters have cited the massive injection of currency as leading to a long period of stagflation, at best; and runaway inflation, at worst. These developed countries could now more properly be called "over-developed." Manufacturing is in decline, unemployment is rising, and GDP is falling. Media attention has now gone truly global in its search for answers and safe havens; analysis and information is pointing more and more to the developing world for the simple reason that it is still developing. Recently The Economist Intelligence Unit, in collaboration with George Mason University, released its study covering the most stable countries in which to live and invest during the financial crisis.
Norway Denmark Canada Sweden Finland Switzerland Mauritius Costa Rica New Zealand Luxembourg
Immediately evident in this top 10 is that two locations: Costa Rica and Mauritius have GDPs well below what would be called “developed.” And, yet, experts have seen fit to include these two small countries in the same company as the common top-10 selections in Scandinavia. Upon closer examination of the key categories sought by retirees: low cost of living, quality healthcare, warm climate, access to North America, and political stability; it is Costa Rica that emerges as the clear #1 choice.
On the Radar
If the above study were the only one to highlight the benefits of Costa Rica, it would still cause a stampede. But another study by Forbes magazine has ranked Costa Rica as #5 in the category of World’s Cleanest Country. Retirees should indeed be looking for stability and quality of life; the fact that Costa Rica boasts no military, a low cost of living, quality healthcare, and is close to North America is creating a rush of optimism amid world gloom. This is even further enhanced by the fact that many traditional retirement enclaves such as Panama, Nicaragua and Mexico were much lower ranked on both lists, and all are seeing increasing problems in terms of safety, politics and economy.
Costa Rica actually has been on the radar for quite a while, relative to its size, but has remained dwarfed by expat havens like Mexico. Costa Rica still derives most of its income from tourism. It stands as the most visited nation in the Central American region, with over 1.5 million foreign visitors in 2008, a higher per capita rate than other popular destinations such as Mexico, Dominican Republic, and Brazil. Moreover, Costa Rica continues to gain popularity for its strong stance on the environment, leading renown economist Thomas Friedman to write in The New York Times, “More than any nation I’ve ever visited, Costa Rica is insisting that economic growth and environmentalism work together.” Strong government policy already has encouraged those interested in sustainable living to relocate, and now that many businesses have seen the friendly policies of the Costa Rican government they are recognizing that this is the country where they can grow and benefit from worldwide interest in sustainability and living a life based on wellness.
This small country, the size of West Virginia, has now been praised on every level by the top experts. One can only imagine what this means for the price of real estate. Now is the time to evaluate whether Costa Rica is the right choice for you.
Considerations for Costa Rica Expats
We speak with tourists and expats every day. We have met many tourists who have decided after multiple visits to Costa Rica that this was the county for them; and we also have met people who had done a lot of reading and decided to move immediately without a visit! We always recommend as many visits as possible in order to properly gauge where exactly you will be most comfortable, but enjoyment of day-to-day life in Costa Rica seems to have much more to do with attitude and perspective. Our network has identified three traits that appear to be essential to live and prosper outside of your country of birth:
* A desire for new experiences
* An intense thirst for knowledge
* Open mindedness
These three areas sound simple, but one must dig deep into their own inner workings if one can prepare in an honest way. If not properly evaluated, one's personality and worldview could be in conflict with the idiosyncrasies of a new culture. Proper research and education are the safeguards against the surprises that can derail a dream.
The pace of life in Costa Rica is much slower. For most people, Costa Rica offers a tranquility that they had been seeking. The culture is a non-confrontational one, best represented by the fact that the military was abolished in 1948. In 1949, the abolition of the military was introduced in Article 12 of the Costa Rican Constitution, and it has been a stable democracy ever since. Non-confrontation is so built in to the Costa Rican psyche that it can be an area of continued frustration for an aggressive and impatient personality who cannot accept that things will not always be done immediately. But, it is this cultural trait that has resulted in Costa Rica having one of the lowest rates of violent crime in the world. Most people can accept such a tradeoff. The slower pace of life can also be seen in a positive way within the medical community. Time and again, people have reported to us that doctors spend more time, are more thorough, and speak to them as if they are people, not just patients.
The physical climate of Costa Rica has always been a key feature. As most retirees desire warmer areas, there are not many locations which can boast “The Best Climate of the World” without carrying a price tag to match. Costa Rica’s climate and landscape most resembles that of Hawaii, at 1/10th of the cost, with a lower rate of crime. It is a subtropical country in which just about every temperature is available based on elevation. Some prefer the coast at 90+ degrees Fahrenheit, while others might choose higher elevations, which can experience temperatures in the 40s. Costa Rica also lies too far south to be a target for hurricanes, which has drawn many more ex-Floridians, who have discovered that the additional safety, still lower cost of real estate and living, as well as the beauty of lush vegetation and mountains, is a magical combination.
First-hand knowledge
There are many Web sites, blogs, online forums, and books that can provide all of the information and details about every aspect of Costa Rica. Forums are a particularly good way to get a balanced assessment of life on the ground. However, this cannot be a substitute for seeing the country yourself. If you are interested in housing, it is essential to see the community in which you intend to live. There are a handful of companies offering relocation tours and this is a good way to see the many areas in which expats live, and enable you to feel the many microclimates of Costa Rica. One such tour is Boomers in Costa Rica, at www.boomersincostarica.com. This company offers a unique 4-day tour in which people learn all about living in Costa Rica, what it costs to live here, buying property and much more.
If you are intersted in simply locating a property, it is important to find a credible real estate firm with experts who have intimate knowledge about the area in which you are interested. One such firm is Costa Rica Land & Property www.realestatecostarican.com. The owners Terry, Rigo, and Jeff are experts in Central Valley real estate. Jeff is the author of a book about real estate investing techniques in Costa Rica called, Real Estate Investing Guide: Fundamentals for Profit in Paradise. This book can be found at www.paradiseprofits.com.
For those looking for ocean-view properties at an excellent value, San Ramon is a must-see location. CR Communities has projects specifically geared toward retirees and investors. For full details visit www.crcommunities.com.
For those looking to live near the nation’s capital, San José, Ameurope Global Services can help you with real estate and relocation advice for the popular expat suburbs of Escazú and Santa Ana. These areas are closest to the best hospital in all of Latin America, Hospital CIMA. These areas are also popular for those who wish to be close to upscale shopping, the main business districts, and the cultural choices of museums and The National Theater in San José. For a full description visit www.ameuropeservices.com
It’s rarely said that looking to relocate to Costa Rica is not an adventure—it can be. However, it can also be great fun if you keep your eyes and ears open and go with your most important emotion—your common sense. In the meantime, contact some of the professionals in this article and get the assistance you deserve. Pura Vida!
Michael Anthony writes for one of Costa Rica's leading real estate magazines: Costa Rica Real Estate and Tourism Guide. He is currently at work writing a book about environmental protection in Costa Rica, as well as creating a web portal for green business.
