Are you interested in retiring abroad? Over four million Canadians currently live abroad, according to a 2022 report from Statistics Canada.
Aside from the opportunity to explore a new country and culture, retiring abroad may allow you to live a better quality of life, especially if the cost of living is low. That being said, some challenges could arise while living abroad full-time.
Below, I’ll share some of the best countries for Canadians to retire abroad in, outline some of the pros and cons of each, and go over some of the key things you should consider before selecting a country to retire in.
I’m currently travelling and living abroad in Bali, Indonesia, as I’m writing this. Over the past couple of years, I’ve spent time travelling through a number of countries, each with its own unique benefits and challenges.
If you plan on retiring abroad and living in another country full-time, you’ll also need to take some factors into consideration, including:
- Cost Of Living: Living in a foreign retirement country can significantly impact your budget. The average cost of living in that country determines the affordability of housing, food, utilities, transportation, and entertainment. A lower cost of living can allow your retirement savings to stretch further, potentially improving your quality of life and allowing for more leisure activities.
- Visa Requirements: Visa requirements vary greatly between countries, affecting the ease of relocation and the duration of your stay. Some countries offer retirement visas, while others have more stringent immigration policies. Having a thorough understanding of these requirements is critical to ensure a smooth transition and legal residence.
- Expat Community: A large, active expat community can provide invaluable support, easing your transition into a new culture. Your local expat community allows you to socialize, make new connections, and get practical advice to help you navigate local customs and regulations. Ultimately, it will make you feel less isolated, which can help you enjoy a foreign culture more.
- Language: Understanding the local language significantly influences your everyday interactions and ease of living. It affects everything from buying groceries to socializing, and it’s important for feeling at home in your new country. If you’re not fluent, consider the locals’ proficiency in English or French (if you’re a Quebecois).
- Healthcare: Having access to high-quality healthcare is vital for retirees, particularly as health issues may become more prevalent with age. Consider the country’s healthcare system, the cost of health insurance, and accessibility to specialists and advanced medical services. In some cases, the availability of English-speaking doctors might also be important.
- Climate: The climate affects not only your comfort but also your lifestyle and health. Whether you prefer warm, tropical climates or cooler, seasonal ones, it’s important to consider how the weather patterns will impact your daily activities, hobbies, and any existing health conditions.
- Safety: Safety, including low crime rates, political stability, and the presence of natural disasters, is essential when choosing a retirement destination. Research the country’s safety records, understand the local laws, and consider how you would feel living there. Your personal security and peace of mind should be a top priority.
Are you ready to find the perfect retirement destination for your golden years?
Once you’re retired, you should be receiving a steady source of retirement income from your RRSP/RRIF, a government pension plan (such as the CPP), and any investments that you’ve made over the course of your career.
This means you’ll have plenty of free time to explore and experience a brand-new culture in a beautiful country.
Here are some of the best foreign countries to retire in, based on my personal travels, research, and conversations I’ve had with fellow expats and travellers.
Thailand has become an increasingly popular retirement destination for Canadian retirees seeking a warm climate, affordable living, and a vibrant culture. It’s also a dream come true for fellow Thai food lovers!
The country’s cost of living is significantly lower than in Canada, which will allow you to enjoy a comfortable lifestyle on a modest budget. What may only serve as a humble retirement budget in Canada could allow you to live in luxury in many Thai cities.
The affordability also extends to housing, dining, transportation, and even healthcare, which is of high quality and accessible, with many English-speaking medical professionals.
That being said, you will need to purchase your own private healthcare to maintain your residency and Visa status in Thailand. You must provide continued proof of your healthcare coverage to the local immigration authorities every 90 days.
Thailand’s climate is tropical, offering year-round warmth (a stark contrast to Canada’s harsh winters). This means you won’t have to worry about those cold winter storms flaring up your arthritis and joint pain.
The country has a steadily expanding ex-pat community, as well. It’s currently home to around 150,000 foreigners, around half of whom are retirees.
The language barrier shouldn’t be too much of an issue either. While the Thai language is challenging to learn, English is commonly spoken in major cities and tourist areas.
After a few years of practice, you should be able to pick up on some basic conversational Thai, though, which will help you navigate the culture and befriend more locals.
Despite some safety concerns related to traffic and occasional political instability, the crime rate against foreigners is relatively low, making Thailand a safe place to retire.
Thailand has several Visa options for travellers to choose from, including the O-A retirement Visa. The Non-Immigrant O-A Visa is available to foreigners over 50 who have a clean criminal record, a monthly retirement income of at least $2,500, and private health insurance.
The O-A Visa can be renewed indefinitely every year, providing that you continue to meet the base requirements and have a full-time residence in the country. Once you’ve lived there long enough, you can also pursue permanent residency status.
- Very low cost of living
- Friendly people and welcoming culture
- Incredible food
- Many locals speak English
- Large ex-pat community
- The country is home to tropical beaches and lush jungles
- O-A retirement Visa is easy to obtain and renew
- You can’t purchase real estate with a retirement Visa, meaning you must rent your residence
- You must purchase your own private healthcare
Related Reading: How to Retire in Thailand from Canada
If you prefer to retire in Europe, then Portugal is an excellent option to consider.
Its cost of living, housing, food, and transportation is among the lowest in Western Europe, which allows retirees to live a high quality of life at a fraction of the cost compared to Canada.
The country’s climate is Mediterranean, characterized by hot, dry summers and mild, wet winters, which is a significant draw for those accustomed to Canada’s frigid winters. It’s often referred to as the “Florida of Europe.”
It’s an incredible place to explore as well. The country offers rolling mountains, picturesque valleys, and rocky coastlines and is also home to a number of vineyards and wineries.
One of the best ways to spend an evening is to visit a small coastal town, drink some local wine, eat some great food, and watch the sunset over the water.
Portugal features a top-notch healthcare system, ranking 12th in the World Health Organization’s global healthcare ranking.
The country has a thriving expat community, especially in areas like the Algarve, Lisbon, and Porto. Although Portuguese is the country’s official language, the majority of locals also speak English, so you’ll have no problem making friends, shopping, and interacting with your community.
Last but not least, Portugal is considered a very safe country with low crime rates.
There are two Visas that you can choose between if you want to retire in Portugal from Canada:
- D7 Visa
- Golden Visa
Portugal’s D7 Visa, or passive income visa, is particularly attractive to retirees. It permits residence if you can demonstrate a stable income (over 780 Euros per month) and are willing to live in the country for at least 183 days per year.
If you have greater financial means and want to purchase a home in Portugal, you can apply for the Golden Visa (this program is set to end by the end of 2023). There are stricter requirements for this visa, but it also comes with greater privileges and can fast-track your path to permanent residency.
- Low cost of living
- Most locals speak conversational English
- Low-income requirements for D7 Retirement Visa
- Golden Visa allows you to purchase property
- Beautiful landscapes and quaint cities to explore
- Tourist areas can be crowded
- Dealing with the government bureaucracy can be time-consuming
Related Reading: How to retire in Portugal from Canada
3. Costa Rica
Costa Rica is a jungle paradise and is one of the safest, most friendly countries that I’ve ever travelled to. Although the cost of living has increased slightly over the years (partly due to the growing expat community and foreign investors), it’s still quite affordable compared to most regions in Canada
If you like to explore, there are limitless opportunities in Costa Rica. From lush jungles to tropical beaches, volcanoes, mountains, waterfalls, and more, there are limitless opportunities for adventure.
The local community is another huge plus.
Not only is there a huge expat community in Costa Rica, but the locals are committed to building a sustainable, eco-friendly culture that values natural landscapes and communities over industrialism.
Of course, the only downside is that modern amenities can be scarce, and access to the latest technology (such as buying a brand-new iPhone) can be difficult and costly.
The country’s locals primarily speak Spanish. However, English is a popular second language, and many locals speak both languages fluently. With some practice, you’ll be speaking “Spanglish” in no time.
While healthcare is generally affordable and accessible, it’s not quite as advanced as what you may be used to in Canada. This could make it difficult to find treatment for specialized diseases and illnesses.
For residency, Costa Rica offers a ‘Pensionado’ program for retirees, requiring proof of a steady pension income.
To qualify for the Pensionado Visa, applicants must have a lifetime monthly pension of at least $1,000. This can be through various sources such as social security, annuities, retirement funds, military pensions, or other retirement benefits.
Costa Rica does not have a minimum age requirement for pensioners. The Pensionado Visa provides temporary residency and comes with benefits like discounts on transportation, entertainment, and medical services.
The Visa can be renewed every two years. Once you’ve renewed the Visa three times (six years), you’ll be eligible to apply for permanent residency.
- Thriving ex-pat community
- Friendly, eco-conscious community
- Beautiful jungles, beaches, and volcanos
- Great food
- Moderately low cost of living
- Easy Visa application and renewal process
- You can become a permanent resident in six years
- Access to new vehicles and technology is limited (and costly)
- Phone and internet service may not be as quick as you’re used to in Canada
- Costa Rica periodically gets hit by severe tropical storms and flooding
Related Reading: How to Retire in Costa Rica from Canada
If you never want to experience a cold winter, snow, and ice again, then Mexico is a great destination to consider. Compared to the countries on this list, it offers an incredibly low cost of living, allowing retirees to stretch their pension funds significantly more than they would in Canada.
Spanish, of course, is the main language spoken in Mexico. However, English is a common second language spoken conversationally in many major cities and tourist destinations. That being said, learning conversational Spanish is recommended and will greatly help you.
There are a few popular retirement destinations in Mexico, including:
- Riviera Maya
- Puerto Vallarta
- Lake Chapala
- San Miguel de Allende
That being said, many regions in Mexico are considered unsafe. Major cities and retirement/vacation destinations are generally protected. However, you could find yourself in cartel territories if you venture too far outside of safe zones.
Retiring in Mexico is relatively easy for foreigners, as foreign investment greatly helps local economies.
To retire in Mexico, you’ll need to start by applying for a temporary resident Visa. This must be renewed after one year and can be renewed for a total of four consecutive years.
After four years, you’ll need to apply for permanent residency, which is relatively easy to obtain if you have a steady pension income or have invested in Mexico by purchasing land or starting a business.
- Very low cost of living
- Beautiful beaches
- Easy to obtain a Visa and permanent residency
- Many regions of Mexico are dangerous
- English isn’t spoken much outside of major tourist areas
Related Reading: How to Retire in Mexico from Canada
Retiring in Spain is similar to what you’d experience retiring in Portugal. The region shares a similar Mediterranean climate, with warm summers and very mild winters.
Although Spain’s cost of living is slightly higher than Portugal, the cost of housing, healthcare, and everyday expenses in Spain are generally lower than in Canada, allowing retirees to enjoy a comfortable lifestyle without overspending.
Spain offers incredible food, top-tier healthcare, a rich culture, and is a very safe place to live. You can tour historical cities (such as Madrid) and scenic vineyards or explore Spain’s incredible coastline and beaches.
While Spanish is the primary language spoken here, English is a common second language, especially in larger cities. There’s also a large ex-pat community, which can help you adapt to life in Spain.
To retire in Spain, you’ll first apply for the non-lucrative Visa, which allows you to live in Spain for one year, providing that you meet certain income requirements, have a clean criminal record, and have proof of private health insurance coverage.
After this, you may renew the Visa for up to two-year periods. After the first Visa renewal period, you may also begin applying for permanent residency.
Similar to Portugal, you can also apply for a Golden Visa in Spain, which allows you to purchase property and can fast-track your path to residency.
- Rich culture and history
- Great food and wine
- Moderately low cost of living
- Easy Visa application and renewal process
- Cost of living is higher than in countries in Southeast Asia or Central/South America
To wrap up, here are a few answers to some frequently asked questions about retiring abroad as a Canadian.
Until you become a permanent resident of the country you retire in, you’ll continue to pay income taxes to the Canadian government based on the amount of your pension payments and Canadian investments.
If you start a side business or begin earning income in the country you retire in, then you’ll typically be required to pay taxes to that government as well as Canada.
Taxation rules can vary significantly from one country to another, though, so it’s best to speak with an accountant or CPA who specializes in international taxation.
As long as your Visa remains up to date, you shouldn’t have to come back to Canada. The only reason why you’d be required to come back to Canada is if your Visa expires or you choose to visit home.
Retiring abroad can affect your personal and government-sponsored pension payments. It all depends on the tax agreement that the country you’re retiring in has with Canada.
Your RRIF withdrawals typically won’t be affected as much. However, your CPP and OAS payments could be reduced or subject to additional taxes, depending on how long you’ve been a Canadian resident.
Unfortunately, your Canadian universal healthcare doesn’t cover healthcare received outside of Canada. This is why many countries require retirees and Visa holders to purchase third-party private health insurance.
Retiring abroad can be exciting and often comes with many benefits. However, it’s important to research before deciding on a destination.
I recommend travelling to one or two of the countries I mentioned to get a feel for the culture and atmosphere before deciding.
Once you decide, retiring abroad is a relatively simple and straightforward process. Once you arrange your affairs in Canada, gather your belongings and documents and are approved for a retirement/temporary resident Visa, you’ll be ready to start your new journey.
Planning your retirement income is very important if you want to retire abroad. Keep reading to learn more about Canada’s pension plans!