Tax heaven in Panama has become the most desirable place in the world for retirees
As noted in a publication by «Lenta.ru», the main goal of a migrating retiree is to find a place on the globe where significantly reduced incomes will allow for a familiar, and perhaps even more comfortable, lifestyle. In addition, climate is of great importance: those who have finished their careers rightly believe that now, not tied to an office, they have the right to bask in the sun. It would also be good if the new place has quality and not very expensive healthcare: after all, 60 years is not 25. Also important are a stable geopolitical situation, absence of crime, and a minimal language barrier. There are many countries that meet these criteria. And the undisputed queen among them is Panama.
Many countries are happy to welcome affluent foreign retirees, granting them residence permits or even permanent residency. But in Panama, a red carpet is practically rolled out for financially independent elderly people.
In this country, one can live comfortably on $1,500 a month. Incidentally, the national currency – the balboa – is little used; Panama has gone the route of dollarization. The balboa is pegged to the dollar at 1:1. The Panamanian constitution prohibits the government from resorting to emissions, so inflation, which has plagued many Latin American economies, need not be feared. Income earned in other countries is not taxed in Panama. The country's economy is based not solely on tourism, and GDP is steadily growing.
"Hub of the Two Americas" – that's what Panama is called, because there is simply no better location for exploring both continents. From Tocumen Airport (Panama City), it is easy to reach countries in Latin America, Europe, and the States. For example, if someone had the idea to fly from Panama City to New York for the May holidays and back, it would cost about $460 (direct flight).
In 2015, a couple moving to Panama with a budget of, say, $2,650 could expect such monthly expenses:
• rent of an apartment in the center of Panama City (with two bedrooms) – $1,500 (but closer to the outskirts, a one-bedroom apartment can be rented for about $550);
• utilities – $250;
• food and household items – $300;
• maintenance and fuel for one small car – $200;
• cinema twice a month and restaurant four times a month – $150;
• phone, internet, cable TV – $100;
• healthcare – $150.
Some retirees prefer not to rent but to buy property. Prices cannot be called dirt cheap, but still they compare favorably to the cost of comparable European and American real estate.
Mostly, expats live in Panama City and its surroundings. But those who want complete peace and also wish to save money consider other options. For example, Pedasí – a resort region five hours' drive south of the capital. Rent a house by the ocean from $600, purchase from $130,000. It is believed that Pedasí has almost the best beaches in Central America. There are many English-speaking expats in the region.
An inexpensive and comfortable old age can be arranged not only in Panama. But what sets this country apart from other paradises favoring expats is the Pensionado program, which provides retirees with numerous discounts on goods and services. Pensionado also applies to foreigners.
The discounts are as follows: 50 percent on entertainment, 30 on public ground transportation, 25 on some flights, 30 to 50 on hotels, 15 to 25 on restaurants, 10 to 20 on medical services, 25 on electricity bills. Senior expats can also count on significant benefits under mortgage programs. Every two years, foreign retirees can buy a car without paying import duties (and likewise purchase other foreign goods worth up to $10,000).
To become a participant in the program, one must be in at least relatively good health and have a certain level of monthly income ($1,000 per month per person or $1,250 per couple).
Medical services are not very expensive in Panama. Many prefer not to buy insurance (costs about $100 per month), but to pay out of pocket as needed (one visit to a doctor about $50). You can go to public medical facilities, but both Panamanians and locals prefer private clinics, as they are also inexpensive and the quality of service is better.
Rankings of the best places in the world for retirees are published regularly in the media. For example, in 2016, the publication International Living recommends considering countries such as Ecuador, Mexico, Costa Rica, Malaysia, Spain, Portugal. But experts still gave first place to Panama. However, specialists at Live and Invest Overseas for the third year in a row recognize Portugal (the Algarve region) as the main retirement paradise.