How you can afford to retire abroad

PUBLISHED: 30 AUG 2014 02:49:00 | UPDATED: 30 AUG 2014 05:01:36

The number of age pensions paid to Australians living overseas increased by 30 per cent between 2007 and 2012.

The number of age pensions paid to Australians living overseas increased by 30 per cent between 2007 and 2012.

STEPHEN WYATT AND COLLEEN RYAN

Spice up your retirement. Who says you have to stay in the family home, go to the same club, look after the grandkids or get those lawns really tidy?

Instead, you can treat this period as a new chapter – one that provides an extraordinary opportunity to grasp afresh at life. After all, 60 is the new 40. 

Thousands of Australian retirees are already ditching the traditional retirement lifestyle. They are packing up and taking off to south-east Asia, to France and to Italy – some for adventure, some to make those retirement savings go further and to live a better life.

The new wave of retiree baby-boomer emigration is already showing up in the statistics – the number of age pensions paid to Australians living overseas increased by 30 per cent between 2007 and 2012. As the boomers age, the ranks of Australia’s retired will explode. The number of Australians over 65 will almost triple within the next 25 years to 8 million.

Many will be underfunded. Many just want to live life more fully. At the same time, the government is less able to fund healthcare, aged services and pensions.

The good news for Australian retirees – whether they’re living it up in Europe or living well on less in south-east Asia – is that government pensions and super pensions are transportable. You can live on your ­Australian pension in Chiang Mai, Penang, Phnom Penh, Bali or wherever.

But there are catches and anyone ­planning to relocate needs to be aware of them. Any move – a three-month ­sabbatical, a two-year break or a total relocation – requires careful planning, especially around pensions, super and tax. It also requires consideration of visa and health issues.

A LIFE OF (RELATIVE) LUXURY

Geoffrey and Michael chose Bali as their new home. When their working lives came to an end, they realised they were underfunded for a decent life in expensive ­Australia. So in 2010 they moved to Ubud in the mountains of Bali and for $60,000 built a Balinese style house with inground pool and landscaped gardens. They have staff and live in luxury. 

Although Sydney barrister John Overall was “enjoying a reasonably successful career, making good money and living comfortably on the northern beaches”, he was stale, unhappy and overweight. At 62, having been introduced to Vietnam after representing Vietnamese nationals in a court case in Australia, he moved to Saigon. Divorced with adult children, he says: “I am at an age where I have done my job as a barrister. I am reasonably successful. I have no debt. I want to enjoy the rest of my life – what there is left of it – and I was not enjoying it in Australia.”

He found legal work in Saigon, and took the plunge. “My major concern was I would become a full-time tourist, which I didn’t want. So when the opportunity arose to actually undertake some work here in the profession I was trained in, albeit somewhat limited work, I grabbed it with both hands.’

Sal and Glen* moved from country NSW to Phuket. They are living their dream life on the beach in the tropics at less than half the cost of living in Australia.

Many Vietnam veterans have moved back to Vung Tau. They are reliving their youth and say it is a far better than life in a Wagga RSL or in a pub somewhere else in Australia. The lower cost of living in south-east Asia is a primary driver to retiring there. You can generally get a better life for less than half the cost.

In Malaysia, for example, rent is about 80 per cent lower than in Sydney, restaurants almost 70 per cent less and groceries almost 60 per cent cheaper. The health system is excellent and Malaysia even offers a special visa for foreign retirees called Malaysia My Second Home.

Malaysia is typical of the rest of south-east Asia. Costs are anywhere from 50 per cent to 80 per cent lower than living in Australia.

There are plenty of south-east Asian destinations for retirees to choose from.

Penang, an island off the north-west coast of Malaysia, is a dynamic and comfortable place for Australian retirees. It is like a less crowded, less congested and greener Hong Kong and is filled with British colonial legacies – the architecture of the Empire. Surrounding the colonial icons is a maze of narrow streets filled with cafes, restaurants, shop-houses, galleries and ­boutique hotels.

Across most of Malaysia, the infrastructure is excellent, healthcare is first world, English is widely spoken, the food superb and the environment exotic.

‘SEXPATS’ AND STEREOTYPES

Malaysia is “Asia-easy”. And you get all this at a fraction of the cost of living in Australia. Thailand is also an excellent retirement destination. Costs are vastly lower than in Australia, healthcare is excellent, retirement visas no issue, the tax structure friendly and the lifestyle easy.

But blokes, sex and Thailand are almost synonymous in the minds of many people. When they think of foreigners in Thailand, they immediately think of “sexpats” hanging out in girlie bars in Patpong or Soi Cowboy in Bangkok, Pattaya south of Bangkok and Patong in Phuket . . . and it’s true.

There is, however, a Thailand beyond the stereotype, just as there is an Australia beyond Kings Cross. And it has so much more to offer to retirees.

Chiang Mai is a standout destination. Nestling as it does below the infamous opium-producing Golden Triangle, it still has an “alternative cool” feel to it, but today it is safe and very Western-friendly. 

Retirees from all over the world are moving there. There are book clubs, wine clubs and movie nights. Dorothy, a 70-year-old single woman, says she has found life healthier and happier in Chiang Mai and she is never lonely. She bought a superb 100-square-metre apartment in a complex with gym and pool for $80,000.

As people near the end of their working lives, it is a time for them to take stock. After all, 60 is now the new 40.

There is plenty of living to do at the end of your working life and many different ways to do it. A move to south-east Asia – whether for just a year, a few years or forever – can ­provide a much cheaper (and possibly much better) life.

* Some names have been changed

Sell Up, Pack Up & Take Off (www.planet-boomer.com) by Stephen Wyatt and Colleen Ryan is published this week by Allen & Unwin.