Is Cheap Retirement Really Inexpensive?

Cheap retirement implies retirement that is affordable, but at the same time offering reasonable and mild weather, adequate medical facilities, and plenty of outdoor activities.

The 2012 movie The Best Exotic Marigold Hotel highlights the predicament that many people have in our time: Not enough funds in your combined retirement accounts to pay for retirement in your home town or even your home country!

The movie is probably pushing the limits for dramatic effect. Hopefully in real life such an inexpensive solution would offer a softer landing for retirees. But I know of several people who chose the inexpensive option - especially for the first part of retirement when medical facilities and assistance were not such a big factor.

In January 2010 CBSNEWS reported on the Top 10 Cheap Retirement Destinations. The methodology used was to compare the cost of maintaining a typical international lifestyle in a foreign country with that of New York City.

The destinations, in alphabetical order were:

  • Argentina
  • Bulgaria
  • Costa Rica
  • Ecuador
  • Malaysia
  • Mexico
  • Panama
  • South Africa
  • Thailand
  • Uruguay

India, featured in the above movie, didn't make the list. But keep in mind that these destinations offer a typical international lifestyle like that of New York City!

I think your average retiree would be comfortable with a substantially more moderate lifestyle. Perhaps in Smalltown!

Recently my wife and I re-visited a small town about an hour's drive from the nearest city. It used to be a rather run down town of yesteryear not quite serving the farming community it used to serve in it's heyday.

We were pleasantly surprised. The town is alive with retirees. They picked up the rundown houses for a song. The houses were renovated and enlarged. The huge private plots round each house are cultivated with vegetables and fruit. The new life attracted entrepreneurs and the shops got a face lift. The ancient hotel was restored to its former glory. All in all a pleasant and vibrant town to visit.

The same thing happened to another town we visited about two and a half hours' drive from the nearest city. The dream here is to have their own medical facilities and community infrastructure. We were impressed, but thought that – at the time of our visit – they have not yet gained critical mass for a self sustaining community. However, property is cheap and I'm sure they'll attract more retirees to make the town a viable retirement destination.

The migration to inexpensive or cheap retirement destinations for retirees is not something new. It happened in Switzerland decades ago when the roads and communication facilities were upgraded to make remote villages and communities easily accessible.

My wife and I traveled extensively in Italy and France and found the same trend there. And soon the younger entrepreneurial set follows to service these communities.

Look around in your own neck of the woods. Affordable retirement destinations will probably be close by.

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