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When overseas retirement looms, retreat to Central America

June 20th, 2010

With close to 100 million Baby Boomers hitting retirement age in the next ten years, locations to live out the golden years have become a hot topic, and Central American countries are getting their fair share of attention. But what makes these relatively unknown and moderately misunderstood destinations a good choice for senior living? And which countries boast the best place to hang your hat for the foreseeable future?  Read on to find the top Central American countries to call home.

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1. Nicaragua is at the top of the list of places to retire abroad for those on a budget. The country’s benefit-laden retirement program was revised in 2009 and includes incentives such as no tax on foreign earnings and duty free imports from automobiles to household items. This combined with the innovative Law 306 (tax and import duty exemptions for tourist-related ventures), and the lowest cost of living in the region does much to encourage retirees to the country. And yet, Nicaragua has not yet realized the kind of influx that Costa Rica and Panama enjoy. Some put this to the ‘close relationship’ that the current President has with Hugo Chavez, the controversial leader of Venezuela. But others stress the ‘early in’ nature of the real estate market and it’s potential for future growth.

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2. Panama still beats expectations. Between the beaches (70 to 90 degree weather year-round) and the highlands (50 to 80 degrees and less humidity), you’ve got a range of climates to choose from. But the real perks of retiring here include a stable government, modern banking (the U.S. dollar is legal tender), tax benefits (no tax on foreign-earned income, property tax breaks), and solid roads and telecommunications. The boom years saw hundreds of new condo towers in the capital city (see more analysis on Panama apartments) and real estate projects launched across the country. This was followed in 2009 by a marked slowdown in sales activity. Some over-leveraged projects stalled or suspended operations and re-sales were offered at large discounts. But as we enter the second quarter of 2010, local real estate agents note that enquiries are rising again.

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3. Belize offers the classic Caribbean experience mixed with a long-standing culture of ecotourism. It’s a tiny country packing a remarkable amount of diversity between its borders - tropical forests, mountain summits, a palm-fringed coastline and the longest barrier reef in the Western Hemisphere. Belize stands out as being a true banking haven (retaining high levels of liquidity through the recent banking crisis) with strict secrecy laws.  A major bonus for retiring overseas in Belize is that the official language is English and the legal system is based on British law. Things have slowed since the financial crisis (except perhaps in Placencia where the market seems to be booming) and commentators talk about a more stable and less speculative market taking hold.

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4. Costa Rica has long been considered a great place retirement overseas and for many years set the benchmark to follow for other Central American countries. More recently however, its retirement program has fallen behind its regional neighbors that offer more incentives aimed specifically at retirees. As it’s only her second day in office, it’s too early to see what Laura Chinchilla, Costa Rica’s new President, has planned.  The capital city of San Jose and the Central Valley region seem to be bucking the general slowdown and attracting an ever-growing number of retirees. The northern Guanacaste region also appears to be climbing back after a difficult year in 2009.

Guest post contribution by Sarah Harris, of Zen College Life, the premier directory for online degrees. Find out more information about a psychology degree.

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