Retiring abroad is an appealing idea to an increasing number of seniors looking for a better quality of life. But can you retire in your host country after having spent years working there? What are your options as an expat?
What are your options for retiring abroad?
In principle, foreign professionals having made social contributions in their home country can receive their retirement benefits from abroad. However, it depends on the provisions of the home country, what the host country allows, and the presence (or absence) of social security agreements regarding retirement between the home and host countries.
In an international context of skilled labor shortages, more and more countries are taking measures to retain foreign professionals at the end of their careers. These measures are intended to reassure them about their future retirement in the host country where they have been working for an extended period. Dubai, for example, has introduced its retirement visa (valid for 5 years, with the possibility of renewal) for individuals aged 55 and above. Among the eligibility criteria are investing in real estate, possessing 1 million AED, or having an annual income of at least 180,000 AED.
Other countries offer retirement visas, such as Thailand, Indonesia, Malaysia, the Philippines, Portugal (D7 visa) and Spain. These countries are also popular among expatriates seeking to retire abroad. The validity of these visas ranges from 1 to 5 years, with the possibility of renewal. Thailand offers a 10-year visa for certain nationalities. Malaysia and its Second Home visa allow foreigners (under certain conditions) to stay there for 10 years. Meanwhile, the Philippines offers a visa without any time limits.
Important issues to consider before making a decision
Whether you will stay in your host country or return to your home country will depend on a lot of factors. First is the possibility of converting a work visa into a retirement visa. Not all countries offer this option, and those that do often have high eligibility requirements, especially regarding income. States are more inclined to attract wealthy expatriates who can not only ensure their lifestyle after their career ends but also continue to contribute to the economy through investments or consumption. Additionally, healthcare costs should be considered, especially as they tend to increase over time.
It is also important to consult with the retirement fund to understand the coverage and terms of payment. This leads to several other questions:
- Were you covered during the entire international career?
- What level of retirement benefits can you expect?
- How will the pensions be disbursed?
- What healthcare coverage are you entitled to?
- Are there social security contributions for retirees abroad?
- Are you eligible for health insurance coverage?
- What will be the tax implications for expatriate retirees? Pay particular attention to this point because expatriate retirees can be subjected to dual taxation in the absence of a non-double taxation agreement between the host and home countries.
How to plan your retirement overseas
To fully enjoy retirement abroad, other factors need to be considered. It is assumed that, as an expat, you are already accustomed to your host country after working there for several years. Retirement life is a new adventure that should be prepared with the same level of attention as the initial move. Family, circle of friends, geographical distance, etc., are factors that should not be neglected. You may have built strong bonds and networks with people you met in the host country. However, retirement also prompts reflection. On the one hand, individuals immerse into a new life in a foreign country, but on the other hand, they have thoughts to loved ones who live far away.
How does your family react to your idea of staying in your host country at the end of your international career? Were they expecting this announcement or hoping for your return to your home country? The family's opinion also plays a role and can influence the decision to stay abroad or choose another host country (one closer to loved ones, for example). While retirees ultimately take charge of their choice, the family is also part of the new adventure.
Contrary to stereotypes, retirees remain active and contribute to the local economy. However, the change in status also implies a change in the pace of life. One may spend more time in their neighborhood or, conversely, more time traveling or engaging in new activities (sports, hobbies, investments, etc.). In the first option, one will discover their neighborhood in a different light: previously known only before and after work, now experienced during off-peak hours. These are additional factors to consider when preparing for retirement abroad.
Useful links:
Dubaï : residence visa for the retired
