USA topic -- common mistakes retired expats make

[Jingthing]

I reckon most or all of this is already known by seasoned expats and many of us have made some of these mistakes ourselves.

 

So it's really intended more to Americans in the process of PLANNING to become retired expats.

 

 

Quote

 

Seven mistakes commonly made by U.S. citizens when they retire abroad

 

Retirement outside the U.S. is more appealing and less adventurous than it used to be. That might be why the number of Americans retiring outside the U.S. increased substantially over the last 10 years.

 

 

 

https://cuencahighlife.com/seven-mistakes-commonly-made-by-u-s-citizens-when-they-retire-abroad/

[mania]

Yup ????

 

Quote

Believing it always will be less expensive. Over the long-term, the things that drew you to a foreign country could diminish as more U.S. retirees move there

Quote

Many countries subsidize medical care for their residents, and the cost of care often is less expensive than in the U.S. Learn the qualifications for participating in any national medical care system. You might not be allowed to participate or there might be a waiting period.

 

Edited June 2, 2019 by mania

[cmarshall]

There's some stupid advice there.  Yes, currency exposure is a huge risk, more than inflation, but there isn't anything you can do about it unless you retire Ecuador or Panama.  No one in his right mind would consider transferring his assets into baht, which would be into a country in which he has neither a right to remain nor to transfer assets back to the home country.  

 

General advice like this is seldom valuable.  Conditions change.  We have to be prepared to change with them.

[Jingthing]

13 minutes ago, cmarshall said:

There's some stupid advice there.  Yes, currency exposure is a huge risk, more than inflation, but there isn't anything you can do about it unless you retire Ecuador or Panama.  No one in his right mind would consider transferring his assets into baht, which would be into a country in which he has neither a right to remain nor to transfer assets back to the home country.  

 

General advice like this is seldom valuable.  Conditions change.  We have to be prepared to change with them.

Actually there are things you can do about it.

I'll give you an example.

I've been researching Colombia lately. Their currency is historically very weak now against the dollar. A person planning to move there has got to face that it is almost definite that the trend will eventually go in the other way to a significant degree. 

So right now Colombia looks like a super deal.

If you ever want to buy real estate there, at these currency levels it might be the right time.

If you're considering your potential budget if you find you can just barely afford to live there at the current rates, chances are you're going to be priced out later. A tactic to deal with that would be to move to a lower cost area of the country where you know you could still afford even with an exchange rate hit. 

Also it's useful to consider how exchange rates impact visa requirements. We see that now in Thailand with people that used to be able to qualify for retirement based on 65K baht monthly being priced out of that based on rate changes.

Of course we have no control over the rates, but we can consider that risk in making decisions. 

Edited June 5, 2019 by Jingthing

[cmarshall]

Although some people, like Soros, can make good exchange rate calls, for the amateurs it looks like a fool's errand to me.

 

I think the only practical way to manage currency risk is view yourself as retiring, not to Thailand or Columbia, but to FavorableexchangerateLand.  When rates there become unfavorable, you up stakes and move to another country where the buck gets a better deal, if only temporarily.  Buying property would tend to work against the strategy.

[TallGuyJohninBKK]

I thought it was a pretty good general advice article... Obviously, not targeted to Thailand expats specifically. But good food for thought on a variety of expat retirement considerations.

 

I know from lots of years of financial/banking posts here, a lot of U.S. expats move here and do so remaining pretty much clueless as to many financial details, such as how to best access their U.S. funds abroad, what kinds of fees and charges their U.S. bank cards carry when used abroad, etc etc.

 

Edited June 5, 2019 by TallGuyJohninBKK

[Jingthing]

42 minutes ago, cmarshall said:

Although some people, like Soros, can make good exchange rate calls, for the amateurs it looks like a fool's errand to me.

 

I think the only practical way to manage currency risk is view yourself as retiring, not to Thailand or Columbia, but to FavorableexchangerateLand.  When rates there become unfavorable, you up stakes and move to another country where the buck gets a better deal, if only temporarily.  Buying property would tend to work against the strategy.

I totally agree buying property is not always the best decision, especially abroad. But still many people do, and it's common sense that it would be better to buy when your source money is stronger rather than weaker if you have a choice. Obviously the local currency can get weaker still. 

 

Also people can keep moving on, in theory, but many people when retiring abroad are at least TRYING to move to their "final" destination. So in that sense just barely affording a place is a bad sign for the future. You want to be able to afford it now easily. That at least allows for future flexibility. 

Edited June 5, 2019 by Jingthing

[Jingthing]

25 minutes ago, TallGuyJohninBKK said:

I thought it was a pretty good general advice article... Obviously, not targeted to Thailand expats specifically. But good food for thought on a variety of expat retirement considerations.

 

I know from lots of years of financial/banking posts here, a lot of U.S. expats move here and do so remaining pretty much clueless as to many financial details, such as how to best access their U.S. funds abroad, what kinds of fees and charges their U.S. bank cards carry when used abroad, etc etc.

 

Yes it's not comprehensive and it's not deep but many Americans move abroad without thinking about all such things and in many cases you really can take steps especially before moving to minimize predictable problems. 

[bkk6060]

Many expats have some significant assets here.

With, absolutely no Thai will or estate plan.  Add on that many have no medical insurance.

Seems very irresponsible especially if they have family in their home country.  What a hassle for their family and they will probably end of getting nothing from the Thailand assets.

 

 

[mtls2005]

Advance steps:

 

Port existing phone number(s) to Google Voice, or a low-cost (T-Mobile prepaid $3/month) mobile provider, enable international roaming.

 

Come up with an address strategy, full transition, partial transition, family, forwarding service(s). (Once here get a PO Box at a convenient Thai Post Office.)

 

Get at least one no foreign currency fee credit card.

 

Try for an ATM/debit card which reimburses the local ATM fee.

 

Set up wire transfer orders.

 

Renew DL.

 

Consider renewing passport if nearing capacity or fewer than 24 months expiry left.

 

Get another original birth certificate.

 

Scan/cloud all important documents.

 

Bring a streaming adapter: Amazon FireStick/Google Chromecast.

 

 

 

[Johnnyngai]

Do expect medical care in developing counties to be at least 20 years behind the USA.   

 

 

[wpcoe]

On 6/10/2019 at 10:39 AM, mtls2005 said:

Come up with an address strategy, full transition, partial transition, family, forwarding service(s). (Once here get a PO Box at a convenient Thai Post Office.)

When I moved down to Pattaya (from Bangkok) in 2004, one of the first things I did was rent a mail box (not at Thai Post -- I wanted an address that didn't scream "THIS IS A POST OFFICE BOX!") because I anticipated changing addresses freely and updating my US accounts with a new Thai address was often a PITA.

 

One year after I rented the mail box they moved two doors down the street ... so changed their address.  Argh.  Secondly, I had chosen a mailbox at roughly shoulder level so I could open it and see into it without bending over.  (I have a bad back.)  When they moved, my mailbox number suddenly was two from the floor.

 

All to say, the best laid plans can still go astray.

[gamini]

 

 

 

On 6/5/2019 at 10:20 AM, cmarshall said:

There's some stupid advice there.  Yes, currency exposure is a huge risk, more than inflation, but there isn't anything you can do about it unless you retire Ecuador or Panama.  No one in his right mind would consider transferring his assets into baht, which would be into a country in which he has neither a right to remain nor to transfer assets back to the home country.  

 

General advice like this is seldom valuable.  Conditions change.  We have to be prepared to change with them.

Your views are even more stupid, you should have most of your assets in the country you live, so  you don't have to deal with currency fluctuations. We transferred all our assets into Thai baht, which is a good strong currency and has appreciated a lot of the time and will continue to do so,  on the other hand the GBP  has gone from 73 bt to 39. In the last 15 years. What you mean by home country? Thailand is our home!

[marcusarelus]

On 6/5/2019 at 10:20 AM, cmarshall said:

There's some stupid advice there.  Yes, currency exposure is a huge risk, more than inflation, but there isn't anything you can do about it unless you retire Ecuador or Panama.  No one in his right mind would consider transferring his assets into baht, which would be into a country in which he has neither a right to remain nor to transfer assets back to the home country.  

 

General advice like this is seldom valuable.  Conditions change.  We have to be prepared to change with them.

I have a British friend who moved here the same time I did.  He kept his money in a bank in the UK and I moved mine to Bangkok bank.  He had to go home a while back because his money in the UK bank had lost almost half of it's value vs the Thai Baht the country where we both lived.  

 

I applied for American SS here and have my money direct deposited in a Thai bank.  I've been here for 20 years and have done fine with my money in Thai banks.  If I was you I'd find some one who has had success with his money in Thailand and ask him what he did.  

[marcusarelus]

4 hours ago, Johnnyngai said:

Do expect medical care in developing counties to be at least 20 years behind the USA.   

I see a lot of rich folks from the Middle East in Thailand for medical care rather than European countries.  Personally I prefer the medical care here over the USA.  I have had the same problems in both countries and have fared better for less money here.  Each person I'm sure has his own special circumstances.  

[marcusarelus]

On 6/10/2019 at 10:39 AM, mtls2005 said:

Advance steps:

 

Port existing phone number(s) to Google Voice, or a low-cost (T-Mobile prepaid $3/month) mobile provider, enable international roaming.

 

Come up with an address strategy, full transition, partial transition, family, forwarding service(s). (Once here get a PO Box at a convenient Thai Post Office.)

 

Get at least one no foreign currency fee credit card.

 

Try for an ATM/debit card which reimburses the local ATM fee.

 

Set up wire transfer orders.

 

Renew DL.

 

Consider renewing passport if nearing capacity or fewer than 24 months expiry left.

 

Get another original birth certificate.

 

Scan/cloud all important documents.

 

Bring a streaming adapter: Amazon FireStick/Google Chromecast.

 

I had google voice for a couple of years but found it confusing and they mail me too much telling me what to do.  I switch to 2nd line after google canceled my number.  

[madmen]

On 6/5/2019 at 10:20 AM, cmarshall said:

There's some stupid advice there.  Yes, currency exposure is a huge risk, more than inflation, but there isn't anything you can do about it unless you retire Ecuador or Panama.  No one in his right mind would consider transferring his assets into baht, which would be into a country in which he has neither a right to remain nor to transfer assets back to the home country.  

 

General advice like this is seldom valuable.  Conditions change.  We have to be prepared to change with them.

Americans not so bad but the rest of the world would have made a killing on exchange rate had they either bought a well located condo or invested in the SET. Im heading back to oz for 12 months and I have my place rented out 40k/month in BAHT which is going to be great value when buying oz dollars

 

Had I kept everything at home I would have burnt up a lot money and it's only getting worse. Expats living on money invested in home countries are completely screwed (not so bad USA)

 

The Thais will throw you out and steal your condo nonsense has been thrown around for 20 years as its past down from hard core expats to Newbies eager to repeat

[elgenon]

You seem to be saying that retirement income is not part of the exclusion for foreign income. But that is not foreign income. Am I reading it wrong?

[madmen]

4 minutes ago, elgenon said:

You seem to be saying that retirement income is not part of the exclusion for foreign income. But that is not foreign income. Am I reading it wrong?

Me? I was just replying to this

 

"No one in his right mind would consider transferring his assets into baht,"

 

[Berkshire]

16 minutes ago, elgenon said:

You seem to be saying that retirement income is not part of the exclusion for foreign income. But that is not foreign income. Am I reading it wrong?

I think the article is saying if you're receiving retirement income from the US (e.g., pension), you're still responsible for paying US taxes on it while living overseas.  But foreign income earned overseas is exempted from US taxes up to a certain amount.

Edited June 13, 2019 by Berkshire

[suzannegoh]

10 minutes ago, elgenon said:

You seem to be saying that retirement income is not part of the exclusion for foreign income. But that is not foreign income. Am I reading it wrong?

I don't know exactly what you are replying to but retirement income is not eligible for the Foreign Income Exclusion.

[utalkin2me]

Biggest mistake is not getting out of the USA sooner. 

[StevieAus]

6 hours ago, Johnnyngai said:

Do expect medical care in developing counties to be at least 20 years behind the USA.   

 

 

I have never experienced medical care in the US but I have in Australia and for a time in the UK and also in Thailand and the medical care here is excellent.

From what I have read about the US system perhaps you meant to say 20 times more expensive.

[StevieAus]

1 hour ago, madmen said:

Americans not so bad but the rest of the world would have made a killing on exchange rate had they either bought a well located condo or invested in the SET. Im heading back to oz for 12 months and I have my place rented out 40k/month in BAHT which is going to be great value when buying oz dollars

 

Had I kept everything at home I would have burnt up a lot money and it's only getting worse. Expats living on money invested in home countries are completely screwed (not so bad USA)

 

The Thais will throw you out and steal your condo nonsense has been thrown around for 20 years as its past down from hard core expats to Newbies eager to repeat

Agree, I have met several expats who have lived here long term one guy 40 yrs plus another 30 yrs plus they have lived here under several regimes and don’t seem to have been disturbed,

I think there is a large group of whingers of various nationalities who have nothing better to do than complain.

It really beggars belief as to why they don’t return to their home countries if they formerly lived in such a utopia.

 

[elgenon]

1 hour ago, Berkshire said:

I think the article is saying if you're receiving retirement income from the US (e.g., pension), you're still responsible for paying US taxes on it while living overseas.  But foreign income earned overseas is exempted from US taxes up to a certain amount.

Thanks. Not clear to me

[elgenon]

1 hour ago, suzannegoh said:

I don't know exactly what you are replying to but retirement income is not eligible for the Foreign Income Exclusion.

It seems to me that it is not foreign income

[timendres]

3 hours ago, marcusarelus said:

8 hours ago, Johnnyngai said:

Do expect medical care in developing counties to be at least 20 years behind the USA.   

I see a lot of rich folks from the Middle East in Thailand for medical care rather than European countries.  Personally I prefer the medical care here over the USA.  I have had the same problems in both countries and have fared better for less money here.  Each person I'm sure has his own special circumstances.  

Exactly right. I have undergone two cancer surgeries performed at Samitivej. The surgeon was on par with any but the top most tier in the US, and spoke superb English. The convenience and service we far better than any I have experienced in the US. The cost was 1 tenth that of the US. I will admit that there are certain procedures or treatments that I would definitely return to the US for, but those would be quite rare and specific. Of course, other "developing countries" do not compare to Thailand, in which case the first comment is applicable.

[timendres]

3 hours ago, madmen said:

The Thais will throw you out and steal your condo nonsense has been thrown around for 20 years as its past down from hard core expats to Newbies eager to repeat

I agree that "steal your condo" is nonsense. And "throw you out" is unlikely in the general case. But, we must remember that we are foreigners allowed to stay at the government's will, which could possibly change. More likely, however, is the case where an individual is blacklisted, which happens regularly, and can be a serious problem. Or the case of extensions requirements being unmeetable or undesirable. One must also remember the disadvantages foreigners face in any legal proceeding, and the extremely slow judicial system of Thailand. Ideally, one can hedge their wealth. Myself, I own a home in the USA, and have cash and stock assets in US. I also have bank accounts here in which I keep significant baht. And I own small amounts of gold in both countries. I continue to rent here, not out of fear of losing my investment, but due to the desire to be more flexible in my location.

[suzannegoh]

1 hour ago, elgenon said:

It seems to me that it is not foreign income

It isn't, so it's taxable just as if you were living in the US.

[Johnnyngai]

16 hours ago, StevieAus said:

I have never experienced medical care in the US but I have in Australia and for a time in the UK and also in Thailand and the medical care here is excellent.

From what I have read about the US system perhaps you meant to say 20 times more expensive.

In the USA, we have the posted rate and the insurance rate. 

If you are paying out of your own pocket, make sure you negotiate for the insurance rate.

It is usually 1/3 the posted rate.  

I went to a physical therapist last year for shoulder problem,

I told the Philippine therapist that I had arthroscopic surgery 10 years ago. 

The physical therapist told me that at the present time,

only wealthy Filipinos have access to arthroscopic surgery.

 

Ten years ago, my insurance paid the surgeon a 3000usd fee for the procedure.