Best Places to Retire: Central America
GraySpirit | Jul 22, 2009 | Comments 16
Chicen Itza archaeological ruins in Mexico.
One of the areas in the world that has been attracting large number of American retirees is Central America. Many reasons underlie its growing popularity as a place for living abroad. But a major reason has been that these countries have been actively courting the American retiree with special retiree visas, benefits, and the build up of long term care health services.
Other obvious reasons are a lower cost of living and the close proximity of Central America to the United States. It’s quite convenient to be living abroad yet not all that far away from friends and family in the states. When considered all together, these factors make Central America one of the best places to retire abroad in the Western Hemisphere.
For purposes of this article, Central America is the region between the United States and Colombia. This includes the countries of Mexico, Belize, Honduras, Guatemala, El Salvador, Costa Rica and Panama. Usually, this region is considered part of North America, but it has been separated as a unique region for its economic, historical and/or cultural similarities.
Central American Retirement – Physical Landscape
This region is a mountainous and geologically active part of the world. Patterns of volcanism and earthquake activity are similar to America’s west coast. The mountainous nature of the region produces a diverse environment. Although Central America is essentially a tropical region, the physical landscape varies from lush tropical rainforests to cooler highland regions with an almost temperate type of climate.
Poas volcano in Costa Rica.
If you decide on living overseas in Central America, you should keep in mind the potential geologic risks of volcanoes and earthquakes. One should also be familiar with the pattern of hurricanes that sometimes sweep into the region from the Caribbean.
Central American Retirement – Cultural Landscape
Central America was settled long before it was “discovered” by Europe. A number of advanced civilizations emerged in the area as far back as 1500 BC. These include Mayan, Aztec, Olmec,, Toltec and other cultures that evolved into various city states. With the coming of the Europeans, most of Central America fell under Spanish colonial control. The one exception is Belize, which was a British colony. Independence was achieved by most countries in the 1800’s. Although this is a relatively small region, each country does have its own unique history and culture – so this article should just be used as a starting point.
The colonial imprint remains in the region and Spanish culture shapes most of these countries in terms of language, culture, and social systems. The original indigenous cultures have for the most part been reduced to isolated minorities or have been blended into the Spanish culture.
Central American Retirement – Economic Landscape
The most “developed” countries in Central America are Mexico, Costa Rica and Panama. Average incomes in these countries fall in the range from $12-15,000 USD per year. These countries are developing rapidly and have relatively stable democratic governments and economies. Infrastructure in these countries – such as schools, transportation and communication systems, tend to be more developed than other countries in the region.
The other countries have per capita incomes in the range of $3,000 to $9,000 USD per year. Although their capital cities tend to be relatively developed, on a national level most of these countries still have a way to go in terms of developing infrastructure and establishing a stable economy and government.
Mexico Retirement: perhaps the most popular Central American retirement destination is Mexico. Of course, the fact that Mexico borders the United States and offers the retiree a warm and pleasant climate year round are natural attractions. But in recent years, Mexico has also pursued a very aggressive strategy designed to convince Americans to retire abroad in their country.
Despite the negative publicity associated with the swine flu and frequent hurricanes on the Gulf of Mexico coast, the number of American retirees selecting for living abroad Mexico grows steadily. The most popular area seems to be along the scenic Pacific Coast – sheltered from hurricanes and away from the overpopulation of Mexico City.
Mexico, like most countries competing for the American retiree, offers a special retiree visa that makes retirement simple and convenient. It does not have to be renewed frequently and permits the retiree to bring in household goods. If purchasing a home, there are American banks that will help finance the purchase. And seniors are eligible for discounts on many purchases.
Perhaps most interesting is the fact that Mexico has begun to grow its long term care industry to provide health care to elderly Americans. It is still a new and growing industry, but the costs for assisted living plus round the clock health care is much lower than in the USA. Mexico is serious in its attempt to become one of the best places to retire in Central America.
Costa Rica Retirement: this country has also gone out of its way to attract the American retiree to its shores. Unlike many foreign countries that heavily tax imported vehicles, the retiree may import a vehicle without taxes every few years. At present, nearly 25,000 Americans are living overseas in Costa Rica. Those who have chosen the country as a retirement destination may be permanent year round residents or migratory residents – flying south only during the cold American winters.
Unlike many countries with strong protectionist polices, retirees are able to purchase a home exempt from any property taxes. And following Mexico’s lead, retirees are able to bring in $10,000 worth of household goods without paying any duty. Their policy seems to reduce as many of the barriers as possible to immigration. Costa Rica might be the most politically and economically stable country in the region, and definitely is one of the best places to retire.
Panamanian dancers in traditional dress.
Panama Retirement: the third major retirement destination in Central America is Panama. Here, American retirees may enjoy the benefits of an income tax free life. Panama also offers the same property tax and duty free benefits that Mexico and Costa Rica offer.
Panama’s also boasts a senior discount plan that offers 50% discounts on entertainment and hotel accommodations, 25-30% off local transportation as well as air travel, 25% off restaurant meals, and 10-15% off prescription drugs and dental/eye exams. Panama is very serious in trying to position itself to attract Americans who want to be living abroad in their retirement.
Central American Retirement – Summary:
Central America is a nice retirement destination. Mexico, Costa Rica and Panama are the more developed countries with stable governments and economies that are actively pursuing policies designed to attract Americans who have decided to retire abroad. The other Central American countries are generally less developed, but offer an even lower cost of living than these three countries. For many Americans, a Central American retirement offers an opportunity to get away, but remain close enough to home. For a tropical lifestyle, Central America is one of the best places to retire while remaining close to America.
(Photos by: Shadowkill, Andres Ol and Muriel Miralles de Sawicki)
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Filed Under: Central America
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Just a couple of minor corrections, and then a thank you. While I understand the rationale given above for saying Mexico is in Central America, Mexicans consider themselves to be North Americans, and say that Central America begins south of their border. Most geographers would probably agree. Anyone planning to visit or retire to Mexico should keep this in mind.
Second, while there are indeed many Americans living along the Pacific Coast of Mexico, the greatest single concentration of Americans in Mexico (along with Canadians, and various Europeans) is found around Lake Chapala in Mexico’s Western Highlands. Lake Chapala is about 30 miles due south Guadalajara, Mexico’s second largest city. The reason? Lake Chapala has a year-round Spring-like climate, supposed to be the second-best in the world, while the Pacific Coast has a hot and humidly sweltering climate for the greater part of the year. In addition, it is easy to reach a host of wonderful old colonial cities in any direction from Lake Chapala. By contrast, one must drive for hours over the coast range from the Pacific Coast to reach anywhere but other parts of the coast. For the folks who are “beachies”, the Pacific Coast may be nirvana. The rest of us like the beach in small doses at the cooler time of year.
Finally, thanks Grayspirit for including my blog “Jim and Carole’s Mexico Adventure” as a resource. I’ve looked over your website and it looks really useful, and your story about coming to the decision to retire sounds very familiar to me.
Buena suerte on your project, and your retirement! Jim Cook
Just one other correction….. While Mexico may not consider itself to be part of Central America, Nicaragua certainly does. I am curious why this country has been left off the list? And, perhaps on a more macro level, why it hasn’t been included as a retirement destination.
The country has, in fact, positioned itself well for the retirement market. Creating new pension programs, tourism laws, building a Joint Commission accredited hospital, etc. I am not of the retirement age but I believe it should be considered alongside these other countries.
Hi Jim,
Thanks for your input. I’ll do a more detailed feature on Mexico in the future and take into account the revisions that you suggested. Hehe … yeah, and I wrestled with the Central/North American issue for a while. I’ll still leave it as is for the reasons that I cited although you are very correct on this.
Feel free to comment on anything. I am not an expert on everything … which is why I add blogs like yours as references for more detailed – and on the ground perspectives.
Awesome pictures. Interesting one of the things attracting retires is a National Health Care, while here at home they fight it tooth and nail. Go figure. shakes head
Sandy
Thanks for placing the advert it’s appreciated.
Hi Sandy. Not a problem. I’ve tried to leave comments on your site but seem to have a problem doing so. I’m not sure why, but thx for dropping by. Feel free to advertise anytime.
Mexico is not in Central America. It is one of the three nations that make up North America. You know the other two. I realize this creates a little dilemma for your categorization, but a fact is a fact. North American country.
“FOR PURPOSES OF THIS ARTICLE, Central America is the region between the United States and Colombia.”
The article does not state Mexico is geographically in Central America.
Sure it does. Read the headline: Best places to retire: Central America.
Ah, I wrote my previous comment before reading Jim Cook´s comment on the same issue. However, he errs in saying most geographers “would probably agree” that Mexico is not in Central America. This is akin to saying most mathematicians would probably agree that 2 plus 2 equals 4. All would agree with that, and all geographers will tell you that the three countries of North America are Canada, the United States and Mexico. And that Central America starts with Guatemala and ends with Panama.
So, in the interest of accuracy, you will need to rethink your categories. Since Mexico is becoming a major retirement spot for Americans (probably the most popular in the world), perhaps it deserves a category by itself.
However, I would not favor that because too many Gringos are heading south and, like you do where you are, I tend to dodge them as they congregate like pods of whales in Starbucks, etc. I believe you said something similar elsewhere.
But enough of this. You have a great website and, with luck, you will draw some of these Americans away from Mexico, where I am, and over in your direction. I hope.
Hehe … I agree, but am stuck with my categories for now. Maybe I’ll change North America to Anglo-America instead and just include Canada and the USA. But … in another 10 years it might just be Canada and Latin America … hehehe.
Costa Rica is just amazing!
I am a Canadian that lived in Central America… Nicaragua to be exact. Mark my words, here and now, this Country will become the next best place to retire!!! Beautiful Country, inexpensive, friendly accepting people, relatively stable government, inexpensive health care, and easy access to other Countries like Costa Rica, Panama, etc.
The coast lines are tremendous for water sports, or just relaxing, culture is abundance and the weather is perfect!
Hello Mark
We’re looking for a place to eventually buy and retire, low costs, warm,and safe. Any info. you could give us would be appreciated.
mike harrill
As everywhere, cinema in Pattaya is a popular and effective mode of entertainment. Movies are not long and most of them are action flicks.
My name is Christine and I read with interest your article
BEST PLACES TO RETIRE – CENTRAL AMERICA and whilst the article was informative I feel you should have included Nicaragua. It is July 2010 as I write this and this is the time to buy in Nicaragua. Compared to its neighbours Costa Rica, Nicaragua is much more affordable and safer place to live. People get the wrong impression as they judge the place by its past history of unrest in the 80s. I have a Real Estate Company and sell both Costa Rica and Nicaragua and my clients usually have the opportunity to visit both countries.In the past year my clients have chosen Nicaragua to invest and especially in the beautiful seaside town of San Juan del Sur. The laws for residency etc are more favorable in Nicaragua than the present laws in Costa Rica. True Costa Rica has over 100 years of democracy and if that is important then I suggest you pay the difference and settle for this area. Either way you cant beat the quality of life especially for retirees on a fixed pension. Pura Vida to all!