I have often be asked for my opinions on retiring in Thailand, whether it is a good place to retire to and how it compares to countries like Cambodia.
In the article below I will list some of the answers readers have asked me on the internet down the years on this subject.
If you want me to answer any questions on Quora or YouTube, or you are looking to invest, don’t hesitate to contact me or use the WhatsApp function below.
Often times, if you are retired or planning to retire overseas, it is essential that you maximise your financial planning.
Not anymore. In some parts of Bangkok, you will struggle on 1k a month, even after tax.
In Chang Mai or some other parts of Thailand, you can get by on $1,000, especially if you have a dual income or own your own property already (meaning no rental costs).
Wouldn’t say you will live like a king though. You may be able to afford things you can’t back at home, like a cleaner and so on.
For retirees in particular, they often underestimate costs, due to things like health insurance costs.
Yes definitely, provided you:
- Learn about the 4% rule – meaning you have $40,000 of income for life
- Are frugal or live a middle class lifestyle
- Avoid huge property and other purchases. Renting is fine.
- Factor in healthcare costs will be higher when you hit 60
- Factor in your lifestyle now. A good rule of thumb is you will spend 2 times less in Thailand than in the West, maybe 2.5 times less
The worst thing to do is put $1m in a Thai bank account. With inflation and other things, it won’t last until 75–80, even if you are frugal.
Somewhere in SE Asia or Europe.
Here is a breakdown of some of the best and what you need to do and some considerations:
Thailand now has a huge retiree population. Hot weather, good food, and great beaches make life here easy for many., Bangkok, Hua Hin, Chiang Mai, Chang Rai and Phuket are all popular expat destinations.
Medical facilities in Thailand are world-class, so much that Thailand is now a health tourism location. With world-class facilities offering heart bypasses from $10,000, you can see why.
Expats coming from the UK and Europe are better off still getting expat insurance though, and for the over 65s, this will cost at least $200-$300 a month, so is a substantial extra cost compared to being in the UK or Spain. If you have pre-existing conditions, moreover, you may not get insured.
To get a retirement visa, there are some financial requirements. You need to have a bank account with THB 800,000 (about $25,000) and double that (close to $50,000) for a couple, or a monthly income of THB 65,000 (around $2,000 a month), or a combination of a bank account and income that exceeds THB 800,000.
After meeting this requirement, you must then obtain a one-year retirement visa. To get this you must be 50, have a Thai bank book and a letter from your bank in Thailand. Also, you will need to provide pictures, a passport and departure cards.
You will also need to get an `extension of stay’ notice and a re-entry permit. This will allow you to re-enter the country if you leave it. Finally, you must report to immigration every 90 days to check in and verify the address you are living in. If you have ever been deported from Thailand or had any criminal history, you may not get the visa.
For people under 50 who are financially independent and retired, you will need to find another solution. One is to enroll on a Thai language course or another education course. Spend a limited amount of money, and get a student visa. In 2017, a `digital nomad visa` was introduced. Called a Smart Visa, it is designed for business people.
They have currently limited the applicants to startup business owners, investors, high-level executives, or other highly-skilled professionals. Visa rules are always changing, but if you have a decent budget and you are under 50, you should be able to get a visa. Spending 2-3 months a year in Thailand on a tourist visa if you live elsewhere in SE Asia, is very easy.
One of the biggest mistakes I have seen in Thailand is underestimating costs. Many Thais live off $1,000 a month or less, and you can too. But this doesn’t include luxuries. To travel a bit domestically and internationally, sometimes eat out, get insured and so on will cost you between $1,500-$2,500 depending on your tastes and expectations. A luxury retirement with maids and a big house may cost at least $4,000-$5,000 a month.
I lived in Jakarta in 2013-2014. Indonesia does attract expats as it is the biggest economy in South East Asia. Jakarta is an expat destination but not a retirement destination. It has some of the worst traffic I have seen, prices are high (especially for alcohol) and it is a business city.
Bali and some other beach resorts, in comparison, are laid back and cheaper. You can live in Bali in a villa and enjoy a luxury lifestyle of spas and massages, all for $2000. A more modest lifestyle can be had for $1,000-$1,500.
What did surprise me about Indonesia was how strict immigration could be. I found Indonesians some of the friendliest people I have met, but immigration at the airport was an exception. It was curious for me, as for most foreigners from high-income countries, why would they go to Indonesia on a tourist visa to take money from the non-existence Indonesian welfare system?
Based on that experience, it shouldn’t come as a surprise that there are numerous requirements to retire in Indonesia. In Indonesia, the age in which you can get a retirement visa is 55, five years older than Thailand. The other requirements include:
• Possess a passport or travel documents with more than 18 months remaining validity
• Copy of all passport pages
• A copy of your resume
• A copy of your marriage certificate, if you are married
• Proof of $18,000 per year of income. This will come from statements from your bank or investment funds. Married retired couples must both prove an individual income of $1500/month and apply separately.
• Proof of medical/health Insurance, life insurance, and third-party personal liability insurance in a country of origin or Indonesia
• Statement of living accommodation in Indonesia. The minimum cost of US$35,000 if purchased house/apartment or, a minimum rental cost of US$500/month in Jakarta, Bandung, and Bali; US$300/month for other cities in Java Island, Batam, and Medan, and other cities a minimum US$ 200/month.
• Statement to declare intent to employ an Indonesian maid and driver while living in Indonesia
• Payment of Immigration Fee based on effective regulations
• You must sign a lease for housing with a minimum one year period. Alternately you can supply proof that you own a house under an Indonesian spouse’s name.
Cambodia is an off-the-beaten-track location but is up and coming. People are friendly, it is cheap, growing fast and has an easy visa system. Retirees can come to the airport and get a business visa on arrival, and then renew for up to 2 years at a time. Kep and Kampot, moreover, are more relaxed than Phnom Penh or Siem Reap.
Having lived in 5 countries, visited 35 and visited more than 200 cities, I haven’t seen a place as good value as Phnom Penh for some things. Not cheap, but good value. Basic goods like water are more expensive than China or Thailand, but you can go to an excellent French or other international restaurants for lunch for $10. And that is for three courses! A traditional Khmer massage can cost you $6-$7 including a tip.
Sihanoukville has a sleazy reputation, but like Pattaya, has been trying to change its image. Some of the beaches are beautiful. It doesn’t have the same amenities as Phnom Penh or Siem Reap, but it does offer a more relaxed lifestyle.
One of the big positives about Malaysia is that they do have a specific retiree scheme. Started in 1997, it has become popular in particular amongst British retirees, which is unsurprising, given that Malaysia is a former UK colony. That fact means that over 90% of Malaysians speak fluent English. Coupled with the golf courses, natural scenery, and excellent climate, this puts Malaysia high on an expat retirees list.
Under the My Malaysia Second Home Program, expats pay a one-off fee of $3,000. The program then helps expats get a ten-year visa and also helps with housing. Like Indonesia, the capital city is more expensive, but the traffic situation is much better. Outside the capital, expat retirees can buy a house for $75,000-$150,000.
Penang is a good destination for retirement. Cheaper and more laid back than Kuala Lumpur, with a good climate and the same excellent food, it offers retirees a great standard of living.
Vietnam doesn’t have as easy visa situation as Cambodia or Malaysia for retirees. But Vietnam is currently in the `sweet spot` of development in HCMC, the most developed city in Vietnam. It is still cheap, but it is developed enough to offer extra conveniences compared to Cambodia, such as readily available taxis and cheaper consumer goods due to economies of scale and other issues.
Even though Vietnam doesn’t currently offer retirement visas, it is relatively easy to stay on tourist and business visas long term. Another negative about Vietnam is like Cambodia; excellent health care can only be found in bigger cities such as Ho Chi Minh. Thailand offers world-class healthcare these days, and health tourism has been their reward. If you get sick or need certain medicines, Vietnam isn’t the best option, even if you get expat medical insurance.
According to International Living (https://internationalliving.com/the-best-places-to-retire/), Vietnam comes way down the list when considering a good place to retire. I would say most expats (both retirees and working-age individuals) seem happy in Cambodia and Vietnam if they can get used to the way of living.
Spain, Portugal, and Greece
Spain is arguably the `original` retiree destination for British, Dutch, Germany and Scandinavian expats. With cheap or subsidized healthcare if you are from the EU (at least for British people until March 2019!), Spain can compete on cost with Thailand and Cambodia once you factor in this benefit.
With relatively good costs in some parts of the country, excellent climate and proximity to other European countries, Spain, Greece, and Portugal will continue to be popular expat destinations.
In Portugal, retirees outside the EU usually hold Type I visas. That visa requires people to show proof of private health insurance valid in Europe, as well as proof of sufficient funds to support living and a criminal background check. After five years’ residence in Portugal, retirees can apply for a permanent residence visa, with associated health care benefits.
Portugal has a great reputation of having friendly locals, an easy-going lifestyle, and ease of opening bank accounts. Against that, driving is supposed to be dangerous and Portuguese is a more difficult language to learn for many expats compared to Spanish and French, but that will depend on your native language.
Also in the EU, but certainly not a traditional retirement destination, Bulgaria is an up-and-coming retirement destination. With houses from $55,000, cheap costs and an ever increasing expat community, Bulgaria’s expat community is likely to continue to grow. Similar to Cambodia within Europe, in some ways.
One of the advantages of Bulgaria is it is in the EU, so expats from other EU countries don’t require visas. Non-EU citizens who are retired in their home country can apply for a Bulgarian Pensioner ID visa and temporary residence permit. Documents submitted to the embassy will include:
- Documents showing you are entitled to a retirement income, legalized with a notary public.
- Document from a bank in Bulgaria ascertaining that the application has a valid bank account in Bulgaria, where regular transfers can be made
- Evidence of address in Bulgaria
- Medical insurance
Mexico/Dominican Republic/Panama/Costa Rica :
For Americans and Canadians, Mexico and the Dominican Republic are good destinations. The visa situation is very favorable in the Dominican Republic, with even over stayers fined a relatively small amount of money.
Mexico has an easy-going lifestyle, but many people are worried about safety. Most of the crimes are committed by people who know each other, such as gang members, so retirees aren’t usually targeted.
For Americans all over the world, getting expat insurance will be cheaper than back home. From experience, most Americans are happier with the overseas insurance situation compared to Europeans. For British people who have grown up in a system where healthcare is free at the point of use, people can feel it is an extra cost.
One of the advantages of retiring in Panama is that you only need to prove funds of $600 a month. That doesn’t mean that it is recommended that you can only live on $600 a month in Panama, but it does show the rules are less strict than elsewhere.
Regarding safety and proximity, Costa Rica ticks many boxes. It has been a retirement destination for Canadians and Americans for 30+ years now for this reason, and many other factors.
Well there are numerous issues here:
- The visa issue. It is always changing
- The tax issue. Thailand doesn’t tax overseas income which is good, assuming you don’t bring it into Thailand. Then you have to deal with the issue from the UK side, and HMRC
- If you can run your business from online
What I would do, is have some consultants and lawyers deal with the tax and visa issues, as they are always changing.
In some ways it is. Let’s say you have a local wife or husband, have lived there for years as a working age expat, so know the language, then yes it can be.
Likewise, I have met many happy retirees in Thailand. The main issue is how much the government moves the goalposts.
Take something which is happening right now. The Thai Government is making it harder to renew visas.
Many expats are needing more expensive health insurance policies, to get a renewed visa
That is just one example of how the rules are being tightened. So many expats are leaving Thailand, or panicking about the increased costs of healthcare, visas and a rising Thai Bhat.
In effect, as more and more tourists are visiting Thailand, the government doesn’t need retiree money.
So it will probably get harder, as times goes on, to retire in Thailand, unless an expat has a lot of money.
So in much the same way that to retire in Singapore often requires an investment visa (like $1m+), Thailand might eventually move in that direction.
There are other places for residency, that are more relaxed, which also offer sand, beaches and 0% on overseas income.
So overall not as good as before, and not the best place for retirees and some nomads, but not the worst either.
It depends on a number of factors. The biggest factors are where you live and your lifestyle.
If you want to live like the average Thai does, you don’t need much money to live.
Some non-Thais do live on $1,000 a month or much less, and are hoping they don’t have any big medical bills, because expat medical insurance gets expensive after 70.
In comparison, if you want to live a middle-class lifestyle that would cost you say $4,000 a month in most developed countries, you might need half of that amount in Thailand.
As one of the contributors has said below, if you want to live like a king, it will be expensive like everywhere.
I would do one thing though. Once you have estimated how much money you need, I would double it!
That will save you from currency appreciations and unexpected costs.
So many expats left Thailand after the Thai Bhat went up, visas and health insurance became more expensive.
So you need to hope for the best, but plan for the worst, as your money (whether from pensions or other income) is unlikely to be in the local currency.
No funnily enough, I just spoke to a client on the phone today. He told me one of his tenants stole from him and…the police don’t want to do anything.
`See your lawyer` is the response, even though they are law enforcement. Shows you the dangers of investing in emerging markets.
Also real estate can be risky as:
1). It isn’t a liquid asset you can easily sell
2). Rents aren’t guaranteed
3). Most importantly, the academic evidence shows property doesn’t outperform investing over time, even leveraged property (buy-to-let). You need to get lucky (right place, right location, right time etc) to do really well with property
4). You can buy REITS. They have performed at about 10% per year. They are cheaper than direct property at 0.1% for some `tracker REITS`, and you can have them in your portfolio and rebalance. No hassle, no need for tenants. Time is also money remember.
5). If you really want income, having REITS and bonds makes more sense, and most of all, the 4% rule.
6). Remember markets have gotten 10% on average over time. 6.5% after inflation. Buffett has `only` gotten 15%-20% over 75 years. If buy-to-let and getting 15%-20% net of fees was easy, why isn’t there somebody wealthier than Buffett?
7). Buffett is the wealthiest investor in the world, and third wealthiest person. Many wealthy people have real estate, but no professional real estate investors can match his returns over a long-period of time. If real estate as an asset class was so easy, there would be many.
8). Real estate has only returned approximately 0.4% compounded after inflation over 200 years in the US.
Just read the evidence and implement it: