5 Asian locations where retirement is more affordable than North America

book-cover-finalBy Jonathan Chevreau

Financial Independence Hub

I’ve personally never travelled to southeast Asia, although my family has and my daughter currently is posted in Hong Kong for a one-year teaching gig. As a result, I was more than usually interested when a review copy came in the mail titled Planet Boomer: Retire now for less in Southeast Asia.

It’s written by a boomer Canadian couple, Jim Herrier and Ellen Ma, who left marketing and advertising positions in 2006 to move to Singapore and Shanghai, then researched a bunch of other locations to help them write the book.

The book is slated for release in mid-August.

Asia 50% more affordable than North America

The pair argue that the financial crisis of 2008-2009 battered the investment portfolios of many Canadian boomers, and that “the math of a comfortable retirement for many of the nearly 10 million Canadians between 44 and 64 is not working anymore.” On average, those boomers are $400,000 short of their ideal retirement savings goal. Most of the 15 destinations in five Southeast Asian countries are at least 50% more affordable than Canada or the United States.

They also factor in another consideration that we highlight here at the Hub: aging and longevity. Those diminished nest eggs may have to last a lot longer than comparable ones our parents accumulated: the authors suggest many boomers will be living at least ten years longer than their parents did.

At the outset they make it clear the book is not intended for those who have “pots of money” and can therefore enjoy a luxury retirement anywhere in the world, including Europe. They acknowledge that the first spots people image are places like Italy or France but “everyone else in the world is thinking the same thing. And that is the big reason why it’s mind-boggingly expensive in key areas and heavily taxed as well.”

As you’ll see below, places like Cambodia and Viet Nam carry a lot of historic baggage for North Americans who may know the names only from the gruesome news coverage of those countries in the late 20th century.

But therein lies the opportunity: a retirement dollar goes a lot further in these places, and the book includes charts that quantifies this: typically $1 for a beer where it costs $6 in North America; meals at $3 to $5 and rents that are a fraction of what they’d be in most large North American cities.

The beaten track will cost you

Their choices may not be obvious ones. While they currently live in Singapore, they conclude that it has “become way too expensive.” The Phillipines and Laos both lack security and good infrastructure. Myanmar is a nice place to visit but they don’t yet recommend retiring there. China is an adventure but “the high cost, congestion, pollution and politics keep both Mainland China and Hong Kong off our retirement list.”

Obviously, it’s advisable to visit first and get short-term accommodation. The next step is to try living in a place but renting. Buying is the ultimate step and may not always be possible in any event. So in most of their chosen locations, you can count on paying rent that is much less than in North America, but with a surprising amount of space and luxury. In many spots, you can hire house-cleaning and cooking services at a very affordable price.

Below, I highlight their observations on the five countries, starting with the one I felt most tempting based on their descriptions, and working down to the less tempting destinations:

1.) Malyasia: “Paradise Under the Radar”

The authors describe Malaysia as “one of the few undiscovered gems in the region,” whether for a full-time or part-time retirement destination. It is “the most retiree-friendly country in SouthEast Asia.” English is widely spoken; there’s a thriving expat community centred on Penang Island, and the cost of living is 50% lower than Singapore to the south. The book’s cost of living chart shows Penang’s consumer prices to be 45% lower than Toronto, rent 77% lower, restaurant prices 62% lower and groceries 47% lower.

2.) Thailand: “The Land of Smiles”

One of the authors’ favourite destinations, Thailand offers “great advantages to the Canadian retiree. It is inexpensive, the people are lovely, the climate superb (if you like it hot), the health care services excellent and the choice of places to live plentiful and diverse … All services that directly involve Thai people (maids, massages, gardeners, helpers, drivers, taxis) are shockingly cheap. You can get a daily mad who cleans and cooks for a hundred dollars a month … The cost of living is very low: half of what you would expect at home.” You can read more about the best places in Thailand here: the island Koh Samui. 

3.) Bali: “The Island of the Gods”

While there are many other beautiful islands in Indonesia, “only Bali can offer the infrastructure a Westerner tends to require. Bali checks all the those boxes.” It has good wireless, English is widely spoken and the expat community of more than 10,000 includes 2,500 retirees. Bali rents are 68% lower than Toronto’s, restaurant prices are 63% less and groceries 43% lower. Even so, for Canadian retirees in their 60s, Bali “lacks the quality services, particularly health care, that you would find in Thailand or Malaysia.”

4.) Viet Nam: “A Country in Transition”

For Canadians considering retirement destinations, Viet Nam is “one of the best — and least publicized — bargains that exists. The cost of food here is so low you can eat out every night if you wish.” In Hanoi, “modern but simple apartments are available for rent for as little as $500/month in the central core … Restaurant meals can be had for as little as $3 to $5 and a beer is $1.”  However, the authors conclude that “as a sophisticated expat retirement destination for Canadians, it is not yet in the same league” as Malyasia or Thailand: “For the moment, we think it is best suited to a younger, more entrepreneurial, more adventurous crowd.”

5.) Cambodia: “The Ruby in the Rough” 

Cambodia is not a common destination for expats, the authors note. Renting is still very inexpensive. “It is clear that living in Cambodia is well within reach of Canadians, especially retirees, who are watching their budget.” According to the expats they interviewed, singles could get by all-in on between $1,000 and $2,000 a month, and couples for $3,000. However, “general medical services of a Western standard are largely absent in Cambodia.” While charming, Cambodia “still has a dark side of corruption, prostitution, human trafficking, and drug running.” The authors conclude that it’s not on par with top-tier retiree destinations like Malaysia or Thailand so is “clearly only for the adventurous type.”

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