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Comment by contingencies | Hacker News Reader

For those who perceive such issues as likely in their future, for whatever reason, I would recommend an alternate strategy of becoming familiar with the social, cultural and legal ramifications of living in or retiring to a developing country. This can be a very effective means to mitigate costs and is widely used by the French (eg. large numbers move to Tunisia for months of the year), and in South and Southeast Asia everyone from old hippies and alcoholics to bitter divorcees and religious retirees.

The point is, think outside the national box. This is easier to do if you properly comprehend the challenges and limitations while younger. For US citizens, just leaving the country pretty much guarantees cheaper access to medical care.

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I wouldn't want to retire in a developing country where I can expect worse healthcare and more crime.

What happens to those people if the dollar plummets in value compared to native currency?

Invest where you think you might end up. Or just invest everywhere; as a youngish American my (very small) future retirement stash is 50% broad-market US and 50% international (Vanguard VXUS). I think this is a reasonably prudent allocation for someone who isn't totally sure where they'll end up, which describes me.

The answer is the same to a number of circumstances- diversify your investments so you can ride through short term market fluctuations and the more long term losses give you less of a hit.

If you're retiring to another country, it makes sense to open a local bank account and have a fairly substantial amount denominated in the local currency. Some retirement visas even require that. That should protect you against a temporary drop in the USD. A long-term drop in the dollar means something really bad happened in the US, which would likely be bad for people retired here too. Worst case scenario, if the USD drops, you come back having spent less of your retirement nest egg than you would have if you'd retired at home.

Plus, having spent a good deal of last year in Southeast Asia, the dollar would have to drop precipitously for it to become a problem. It's very easy for two people to live on under $1000/mo there. Even with ridiculously conservative investments, you only need a few hundred thousand dollars to support that kind of lifestyle. Most people who own their own houses could make that happen.

Mind if I ask where in in SE Asia? I'm having a hard time coming up with a place where a couple of retirees could live reasonably on less than about $2k monthly (when factoring in age-related healthcare costs).

Which is still probably close to a 40% savings over living stateside -- mostly due to medical expenses, of course.

I suppose a follow-on question would be do these countries also provide for assisted living, once our retirees get to that age?

I also spent time in Malaysia, Philippines and Indonesia and all were pretty cheap, but I had Thailand in mind when I wrote my previous comment. They have a retirement visa that means you only need to do visa runs every six months. The only requirements are age (IIRC it was above 50) and a bank account in with, IIRC, around $20K in Baht. I had a medical procedure performed there for which I had been quoted close to $1500 in out of pocket costs beyond what my insurance would cover here in the US. Without insurance, it cost just over $100 there. Dunno if that kind of savings would apply to all medical care, but that's my only data point. Other costs would depend on where you chose to live. Bangkok was more expensive and one of my least favorite places I visited. $2k/mo might be hard there. The islands and south coasts are a lot nicer and $2k/mo is a pretty reasonable target. Chiang Mai was among my favorite cities I visited. $2k/mo is more than you'd need there. Rent is ~$400 and a meal for two is $2-$6. There's a reason why it has a huge expat community...the combination of pretty, comfortable and cheap is hard to beat. For obvious reasons, I can't comment on the cost of an assisted living facility.

This is actually the same question as "what happens if inflation?". Fundamentally it's a big problem with defined-contribution systems: what you want is a life denominated in "2040 dollars", paid for in "2017 dollars", but in the absence of a time arbitrage machine all you can do is pay in and wait.

(Note that $ collapse is much less likely than local currency collapse for pretty much everything except the Swiss Franc)

That seems extraordinarily unfair to the developing countries, especially if it becomes something that people do en masse.

Unfair in which way? Generally these people bring cash and education and support the development of local infrastructure. Many such countries actually offer specific retirement or resettlement visas to attract such migration.

We're talking about an aging population. There are a lot of costs associated with that.

"Generally these people bring cash"

In developing countries you are generally dealing with a user pays medical system. So they don't care if you require extensive medical care as you pay for it.

Developing countries generally have very strict immigration requirements. It's not like Western Europe where you can literally walk in with no papers and get welfare.

Trust me, they're not going to end up paying for anything old retired westerners need.

Agreed. While welfare programs do exist in developing countries, most of them are nominal; though there is a exception - kind of.

True. The Newly industrialized world, (India, Thailand, Sri Lanka etc), have strict rules for non-business/tourism related immigration.

E.g. It's nearly impossible to emigrate to India as a retiree, unless you can obtain OCI/PIO status.

> literally walk in with no papers and get welfare

This isn't true of course, unless you're referring to the tiny amount given to asylum seekers?

If you think it is true, name the country and the specific benefits available to people with no residence and no visa.

Getting into Western Europe needs a lot of paperwork and funds. You can't get welfare unless you are a citizen, or permanent resident either.

It's the opposite, rather. People retiring to those countries go there with lots of cash, spend it, then die. It's like tourism for the rest of your life.

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