On considering my situation, it made me think… “what do the average retired couple do?”.
How do an average retired couple survive when they have few savings, few assets, and rent to pay … when their only source of income is their state pension?
Around the western world, there are millions of retired couples in this situation; many through no fault of their own.. just look at how many people lost everything in the 2007/8 crash.
It doesn’t take a genius to work out that average retired couples are finding it very hard to make ends meet. I call this EXISTING and I don’t think that EXISTING from the age of 65 until you die is good enough.
I think that these retirees deserve more than that. They deserve to LIVE.
I plan to find somewhere:
- With character;
- With a good climate;
- Affordable; and
- With Lifestyle.
With character in the way that Venice has its canals, or Santorini has its beautiful island setting, or Srinigar has its houseboats.
Interesting in that there are always things to do / going on either in the location itself or nearby.
A good climate, for me, is one that is warm to hot (I don’t mind hot) and sunny for most of the year. I do not mind seasons – but it is not what I am looking for… if I want “cold”, I will go on holiday to somewhere cold.
Affordable, for me, this is being able to easily live on an average income without having to plunder assets.
And, with a Lifestyle that people would consider flattering in my home country; such as being able to:
- Live in a modern home in the best area of town with beautiful views;
- Employ a house maid / cleaner;
- Eat in (inexpensive) restaurants three times each day (I can’t actually eat that much but I want to be able to if I want to);
- Have a couple of drinks in the evenings at my favourite bar(s);
- Have an interesting hobby (such as scuba diving);
- Have freedom of movement;
- Reasonably afford to participate in what is going on without ever having to worry about the cost;
- Do all of this with like-minded people that I can call friends.
Inherently, I am looking for a “package” that is significantly better than the one that I have now for the same and / or less money.
Whilst I am seeking my ‘perfect retirement location’ , I will tell retirees of all of the places that I find that they might like themselves – places where they can LIVE on their state pension.
INITIAL DATA SOURCES:
I started by looking at the latest (2014) Backpacker Index which is published by Price Of Travel and the Retirement Index as published by International Living. This helped me put together a shortlist of “countries of interest”.
Further on-line and library investigation revealed a wide range of views on the costs within these countries. I needed more confidence in the figures…
EXPANDED DATA SOURCES:
I gathered further information from a wide range of other sources including:
- Guidebooks like Lonely Planet, Trip Advisor, Trip Wolf and Wiki Travel;
- Ex Pat sites like Expatistan, Allo Expat, Expat Blog, Expat Focus, Just Landed and Transitions Abroad;
- Statistical sites like Numbeo, Budget Your Trip, My Travel Cost;
- Hostel sites like Hostels, Hostel Bookers and Hostel World;
- Other accommodation sites like AirBnB, Bed & Breakfast World and Roomorama; and
- Blogs like Go Backpacking, Intrepid Travel, and Travel Independent.
I only gathered data from sources less than 1 year old.
Some of the reference sites gave dollar figures. Some gave percentages. Some gave indices. Some were written by young Backpackers (with different ‘standards’ from those of a GRANDPAcker)… Needless to say, costs could vary significantly between sites – and I was getting confused about what was what.
So, I knocked up a spreadsheet. I averaged everything out and got costs per day that i believed in: Cost Of Living Analysis By Country.
I used Numbeo and Expatistan to include what they said about the costs of retirement: Cost Of Retirement Analysis By Country. These costs were compared against the Cost Of Living Analysis By Country to ensure that they were sensible, consistency, and realistic.
I concluded that I should easily be able to find a retirement location that meets my objectives on a monthly budget of NZ$2,500 / US$1,625 / €1,500 / £1,050 (exchange rates as at August 2015).
This figure is consistent with what International Living (and others) are saying about their top destinations.
This is a daily budget of about NZ$80 / US$52 / €48 / £34.
I decided to set this as my target budget for:
- GRANDPAcking my way around the world in search of a perfect retirement location;
- Living in the retirement location itself.
Obviously, whilst GRANDPAcking, this budget will feel a bit “tighter” than if I were actually settled in a location paying cheaper long term property rental rates… accommodation costs are likely to be my single biggest cost category…
So, if I can GRANDPAck comfortably on this figure, I will definitely be able to retire more comfortably on this same figure. And, this should be true for retired couples too.
My mission, now, is to find out how realistic this budget is.
MY CHOSEN DESTINATIONS:
I have decided to concentrate on 3 main areas of the world:
- South East Asia;
- South East Europe;
- Latin America.
As my ultimate objective is to find a place to retire, I want to “experience” each country. Therefore, I want to take my time… That brings Tourist Visas into play: I hold a UK passport so here are My Visa Requirements.
I won’t be staying in any one country for more than 3 months. Generally speaking, this means that I shouldn’t have any Visa issues in South East Europe and Latin America (as a 90 day Tourist Exemption Visa is pretty much standard at these entry borders).
There will be one planned exception to this 90 day rule: I plan to spend several more months in The Philippines… The Philippines is a large country with over 7,000 islands and 4 distinct climatic regions and I will need more time than normal.
Visa-wise, South East Asia was a bit of a surprise. These countries are a lot more “stingy” on their standard Tourist Visas with 30 days being more of the norm. Therefore, I will need to extend the standard visas in some of the countries once I get there.
Given the current world climate, I have decided not to travel to any Islamic countries where there are known problems. Therefore, I have specifically excluded (at least for now):
- Mindanao, Philippines (but the rest of The Philippines is OK)
Please do not misunderstand me; I have nothing against Islam. My concern is the growing fundamentalism that is breeding radical behaviour.
Although Islam is one of the major religions in Albania, Bosnia & Herzegovina, Indonesia, Kosovo, Macedonia, Malaysia and (southern) Thailand I will keep these countries on my “active” list for now.
FUNDING & AFFORDABILITY:
As at August 2015, a daily budget of NZ$80 per day is NZ$29,000 (US$18,850 / €17,400 / £12,180) per year.
It is worth noting that $29,000 is also the NZ Superannuation rate (after Tax) for a married couple in 2014. So, I am talking about living on what a typical retired NZ couple have to live on. This makes me feel even better about my set daily budget because it makes it realistic and attainable for the average person… not just a lucky and elite few…
Regardless of the fact that I will be out of NZ for over 3 years, NZ Tax Law says that I will have an “enduring relationship with NZ” because I will still hold interest bearing Bank Accounts in NZ over that period. I will, therefore, still have to pay NZ Tax. This means that I need to gross about NZ$34,000 (US$22,100 / €20,400 / £14,280) per year.
Personal Tax in NZ is 10.5% up to $14,000 and 17.5% between $14,000 and $48,000.
I have income from investments, but this is not enough. I will need to make up the shortfall by getting income from My House.
WHAT IF THE BUDGET IS UNREALISTIC?
I will make every attempt to achieve my objectives on this budget. I am confident that I will be able to because the budget that I have set myself is the budget that sites like International Living are suggesting for a couple to live on comfortably. If a couple can live on this figure comfortably, then I can expect to meet the “above average” lifestyle that I am looking for.
My budget will exclude “one-off” costs and costs that are specific to the nature of my GRANDPAcking venture such as:
- My Vaccinations;
- My Visas;
- My Travel Insurance;
- This Website;
- International / Long Distance Travel;
- Long distance travel between locations within a target country;
- Personal one-off luxuries (such as Scuba Diving).
If my NZ$80 / day budget proves to be totally unrealistic, I will make up any shortfall and report accordingly…
I don’t see any point in being miserable for 3 months in a country just because I can’t live comfortably on the NZ$80 / day target figure.
The challenge is not for me to exist on this budget… the challenge is for me to find a retirement location that allows me to LIVE within this budget.
THE FINAL COUNTRIES:
I re-start my around-the-world journey in Vietnam in October 2015. I will complete my S.E.Asia region (Region 1) in The Philippines.
My next region (Region 2) will be Latin America where I start in Mexico and make my way south. It will take me about 2.5 years to complete this leg of my journey.
I move on to S.E.Europe (Region 3) in 2019 for the European summer.
I HAVE MY PLAN… NOW I NEED TO GET READY …