People choose to retire outside of their native country for a variety of reasons. Some people choose to retire abroad in order to bask in a preferred climate. Some people crave a shift in their pace of life, and some retire abroad for a change of scenery-be it the mountains or a beach. For a large number of retirees, the primary consideration for retiring abroad is their finances.
The reality of rising inflation and a falling income come retirement age encourages a search for affordable living, beyond borders, in retirement.
Over the last 45 years, inflation in the U.S. has averaged about 4.5% annually. If you currently earn $50,000.00 per year, you will need to earn $52,250.00 next year ($50,000.00 x 4.5) and so forth in order to maintain your present standard of living and stay even with inflation. In the same vein, if your investment returns an average of 8% you can reasonably expect inflation to eat away about 3% to 4%, based on historical figures. At 4% inflation you will lose half of your purchasing power in 18 years. Certainly no one can predict the future and inflation could in fact decrease and inflate investments. READ MORE HERE!
