We have been in Europe many years. We consider our move permanent and have been taking steps accordingly. We’re studying the local language (Luxembourgish is a beast), our kids are fully embedded in the local school system (no expat educational bubble), we’ve bought our Forever House , we read the local press and follow local politics, our friends are mostly European (again, no expat bubble), we’re a few months away from securing citizenship, etc etc.
However, we still have some money in savings and investment accounts back in the US, because moving all of it is incredibly difficult. The biggest problem, by far, is the massive burden of financial reporting required for European banks that do business with Americans. It’s called FATCA, and banks here hate it. The American feds are ruthless about receiving every goddamn penny of tax money that’s owed them, so financial institutions required to comply with FATCA must submit endless reports and disclosures on their American clients to US regulators.
The unfortunate consequence of this is that many European banks simply refuse to accept American clients even for basic banking. And if you want to add on investment services, the number of banks willing to work with you shrinks even further. We’ve found only one investment manager here in Luxembourg that will take our business — and they have a cap.
We are dealing with this by “spending down” our Stateside holdings. When we buy a big-ticket item, like our house or our car, we use the American money to do it. Essentially, we’re converting our liquid American dollars into European hard goods and real estate. There are complexities and difficulties, but it’s a reasonable workaround, for purchases above a certain threshold.
Eventually, all our money will be out of the US, and in Europe. But it’s not something that’s trivial to achieve, the way you suggest.
I’ll address this as well, from the other side of the world viewpoint (i.e. SE Asia or South of the border).
Banks in many countries are not as stable and dependable as banks in the US are. Too big too fail is not even a concept they have; in many countries they don’t have much in the way of deposit insurance so you could lose everything and have no recourse to get any of it back.
Also, historically the US dollar has done very well compared to other currencies and even with the present administration its doubtful that this will change significantly over the long term. Many people are retiring overseas and are very adverse to risk, their lives depend on stability.
I guess you could invest and put your money into the Chinese markets and banks, but what to do if our relationship with China (or any other government) goes south. Your assets could very well be seized or frozen, and there you are in a welfare situation in a foreign land.
And why would you assume everyone would want to live like a local? I want to live the way I want with the money I earned, I’m not taking a vow of poverty by moving overseas.
The value that the American dollar will hold, and your ability to transfer US$200k of holdings into foreign currency (as addressed by @Cervaise) is a very salient part of permanently relocating to another country. Americans have lived in a world where their currency is the default, and basically accepted anywhere as long as you are willing to pay an exchange fee, or with pleasure if the local currency is unstable. The assumption of the dominance of the US dollar in the near future is in doubt if the current leadership decides to try to remake the country into a hermit kingdom which it shows every evidence of doing.
So I read a lot of “best places for Americans to retire” lists and Greece didn’t appear on any of them. And I think I just assumed they weren’t friendly to retirees in terms of granting visas. But they have a pretty similar Visa to Spain requiring 2000eur a month guaranteed income and pretty much the same other requirements. Cost of living is somewhat similar - cheaper rent, more expensive consumer goods. Climate is similarly great. Any idea why Greece is not seen positively for retirement?
Wildfires, the economy in the crapper, the first place that immigrants from Africa and the Levant head to, the general fact that Greeks are generally kind of sick of wealthy tourists knocking about even though it is most of their revenue.
With regard to climate change, you really need to consider that anywhere without a solid freshwater supply, resilient against flooding and hurricanes/typhoons/tornadoes, and capable of sustainable food production is likely going to become materially undesirable in your timeframe of the next 25-40 years. The Med has had a reliable climate for agriculture and protection from ocean-borne storms but we’re already seeing that change; ditto for anywhere +/- 15 degrees of latitude from the equator or low laying archipelagos. It isn’t as if there is any place that you will be able to completely escape those impacts but Spain, Italy, and Greece are probably going to be some of the countries hit worst by those changes and least prepared to adapt.
One thing I forgot to mention in my original post is that I really hate haggling and I being targeted as a (white) foreigner and given the high pressure sales pitch and different prices than locals. Like “oh here’s a guy that must be rich, let’s swarm him!” everywhere you go.
I realize this is more prevalent in tourist areas than non-tourist areas, but I know for example hailing a cab in Mexico in any remotely touristy area is going to get you a price 4x higher than what they’d charge locals which you can then haggle down to about 2-3x what they’d charge locals.
This culture is pretty prevalent in central America and the Caribbean, but what about somewhere like Portugal or Spain? Is it like that in Thailand and the Philippines? Is it a big difference between tourist and non-tourist areas? Can you live a fairly normal life in public in these places in less touristy areas?
And please don’t lecture me about how I deserve it, I’m just trying to gather information here.
Agree. I’ve never seen anything in Europe that compares to the “hey man, come look at my shop! good deals! good deals! for you, special price!” that I regularly get in, say, Mexico, or across the tourist areas of North Africa. (Morocco was the worst; Tunisia was better but not great. I was surprised at how little of it there was in Turkey, now that I think about it. Anyway.)
One might occasionally get some pressure sales tactics if one deliberately seeks out a highly intense tourism hot spot (e.g. the souvenir booths around the Tower of Pisa), but considering that the question is about locations where one can retire and live, one probably wouldn’t be going to those kinds of places anyway.
In fact, you can mortally offend shopkeepers in some places if you start trying to haggle - I’ve seen tourists get very short shift in Italy and France for trying that trick. Market stalls are more open to haggling, but usually if the price is written on the item - that’s the price.
And taxis in most of Europe tend to be metered and controlled. So as long as you make sure the meter is switched on, there’s no haggling.
Yes, for sure. In fact, in many tourist-heavy areas, there are flat-rate fares between frequently visited nodes. The cabbie who took us from the airport to the city center in Florence (I think it was) apologized for the heavy traffic, but said nothing about how the delays were impacting his income; he was ecstatic when we gave him a big tip.
Of course, since we are, again, talking about retirement and residency and not tourism, I have to assume the future resident would, pretty quickly, want to learn how to take advantage of local transit options anyway, and stop relying on taxis. Most everywhere I’ve been, public transport has been at minimum pretty good, and frequently excellent. The system in Prague is terrific, for example. It can be a little spotty in the smaller towns, but you have to get pretty far out in the sticks before there’s nothing.
Yes, in the Philippines it is called the skin tax. But they do not harass you about it, once you are there and been around you just tell them you know what the price should be and walk away if they don’t give you the locals rate. Generally they will just cave in and smile, knowing you didn’t just get off the banana boat so to speak.
If Trump boosts tariffs substantially, I would expect the dollar to strengthen (and exporters to be hurt). 1) Reduced demand for foreign good implies reduced demand for foreign currency, which implies weaker foreign currency and a stronger dollar. 2) Higher inflation from higher import prices will lead to higher interest rates set by the Federal Reserve (barring recession, of which risks have increased). Higher interest rates imply higher demand for US currency as foreigners seek to buy US bonds.
This assumes that the US doesn’t default on foreign holdings of US debt. That’s something the Trump admin is actively considering - the plan would mandate a trade of treasury bills (debt which is due in one year or less) for 100 year US bonds that don’t pay interest. This would be illegal under a noncorrupt judiciary, but that no longer applies either.
There are a lot of moving parts here, but we can’t assume vast weakening of the US dollar moving forwards. I expect strengthening over the coming year, but will reassess my forecast as facts emerge. Over a five year horizon, I’d expect weakening as the US dollar is currently over-valued, under a the-Republic-survives scenario.
, we read the local press and follow local politics, our friends are mostly European (again, no expat bubble), we’re a few months away from securing citizenship, etc etc.