Can't Afford Retirement? Move to Mexico

As I wrote in The 10 Most-Hated Money Saving Tips, people don't like to be told to move to a foreign country to save money (see tip #9.) No, they'd rather put up this objection and that objection on why it's a bad idea. Maybe it is a bad idea, but if you haven't saved much for retirement (a situation many Americans will face), it's better than eating dog food and living under someone's porch.

Of all the foreign options, Mexico is particularly a decent place to consider moving to because:

1. It can save you a TON of money (more on that later.)

2. It's not far from the U.S. You can drive there.

3. Nice climate.

4. It's easier to learn Spanish than Chinese. ;-)

So how much can you save by moving to Mexico? Here's what MSN Money came up with:

Suppose you can find a place where the cost of living is about 75% of the cost in the United States -- some beach town north of Puerto Vallarta or south of Manzanillo. What happens to your standard of living when you move to Mexico? It rises to the equivalent of about $42,400 in the U.S.

So let's say you have a $60,000 a year lifestyle but only have enough retirement income (via Social Security and your own savings) to fund $30,000 a year. Move to Mexico, make a few lifestyle changes, and you're not far from your pre-retirement standard of living in the U.S. Not bad at all!

Comments

[Markus]

I believe you got your numbers wrong in the last paragraph - the 30.000 US lifestyle will get you a 42.400 lifestyle in Mexico, not 72400.. As said in the original article "It rises TO the equivalent of..."

[FMF]

Markus --

Yep, you're right. I changed the last paragraph to make it correct.

Thanks for pointing that out.

[Scott]

FMF,
Please help. For some reason about 75% of the time that I try to post comments here I get the message that says the spam blocker has blocked my message. I correctly type in the anti-spam letters on the confirmation page. Help! :)

[FMF]

Scott --

Not sure what's up. Are you operating from a dicey computer? ;-)

Do you have "remember personal information" checked?

[cookie]

how about security? drug related violance? nah, not worth it..

[Invroz]

Want still cheaper alternative but with an equally good quality of life? then move to Malaysia. With the government encouraging My Second Home Program, it has never been better than now.

Some good friend of ours just retired in their 40s by doing exactly this. They ran the numbers and although they would have needed to work in the US until their early 60s to retire comfortably -- they were ready to retire immediately when factoring in the costs and expenses of living in Mexico. They already lived in Texas and spoke fluent Spanish so it wasn't as large a cultural jump for them as it might be for others.

They're about 6 months in, live it a great villa in a friendly ex-pat community, and sound very happy.

[Scott]

FMF,
I did not have "Remember personal info" checked - but it is now. The computer is solid and I have tried both IE7 and Firefox. I am pretty baffled. Hopefully it was just a fluke that was going on for a few days and will go away. I am pretty confident it wasn't something I am doing as I am pretty technically competent (I've spent the last 10 years as an I/T nerd). I'll keep my fingers crossed....

[Rev]

I had a friend in college whose parents did this. They love it. They went south of Puerto Vallarta and have been down there for years. All the concerns cookie has aren't a big deal. You pick the right spot and there is none of that. Now my friend gets super cheap vacations too just has to visit his parents.

[Mexico guy]

I know places on the coast where you can live a very good, comfortable life for far less than the 75% ratio mentioned here.

[mysticaltyger]

I admit that I haven't travelled extensively in Mexico (been to Guadalajara, Guanajuato, Ensenada, Nogales & Tijana)...but from what I've seen, the quality of life just isn't there. The pollution of the land and air is awful. There is widespread "in your face" poverty. The police, legal, and political systems are blatantly corrupt and dysfunctional.

In short, there's a reason why millions of Mexicans are coming to the US illegally. They've got nothing to lose and they know it.

I've traveled to other parts of Latin America where the quality of life seems better, such as Argentina & Chile (Chile, Argentina). And although I haven't visited, Costa Rica and Panama also have reputations for being less corrupt than Mexico.

[Diane]

Cookie's concerns regarding "drug-related" violence are in error. There are some concerns with highjacking, but they are related to other things than drugs. As Rev points out, it is all in where you are. You must understand that and choose where you live.

I personally would opt for Costa Rica; loved it when I was there and while they insist more that you speak Spanish (than Panama for instance), they are a very literate country and most people there speak English better than I speak Spanish.

The State Department has offices which will gladly send you information about living in these places, plus you can check the CIA website for what to look for, but again note that things are in certain areas, and I hear the Bronx is a place for most of us to avoid as well, including certain neighborhoods in my own small midwest town.

Does anyone have any suggestions on how to find property there and know whether or not it is a good deal? Property laws in Central and South America are not the same as in the U.S. - For instance, squatter's rights exist. There are historical reasons why the property laws differ, amazingly related to how the incoming Europeans interacted with the indigenous Indian peoples.

[Yohanan]

Yeah, Cookie's attitude is nutty logic. One would have more troubles driving though south central Los Angeles, Devil's Playground Illinois, New Orleans Louisiana, Oakland California. Sure, there are bad places everywhere. But after Katrina, we got to see how the "new entitlement America" expects their government to fix everything, and hand out freebies ( they even complained that their free mobile home had "new" smells). Down in Mexico they fix things themselves, and are quite resourceful, talented, and respectable, as they have been for many years. Freedom is not letting someone do everything for you, it is being free to do it yourself; that is what is being taken away from us here in the US. Put your faith in YHVH, not chariots and horsemen!

[Zeeshan]

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