Retiring early is a dream for many people, but it requires careful planning and execution. One strategy for retiring early is to take advantage of geographic arbitrage, which involves living in a location where the cost of living is lower than in your home country. This can be either domestically or internationally. In this blog, we’ll explore the different aspects of retiring early, including the pros and cons of domestic and international geographic arbitrage.
Domestic Geographic Arbitrage
Domestic geographic arbitrage involves moving within your home country to a location where the cost of living is lower. For example, someone living in San Francisco might move to a more affordable city like Memphis. Domestic geographic arbitrage can be a great option for people who are looking to retire early but want to stay close to home.
Pros:
Familiar culture and language
Easy access to family and friends
No visa or immigration requirements
Cons:
The cost of living in some domestic locations may still be high
You may have to give up certain amenities or cultural opportunities
International Geographic Arbitrage
International geographic arbitrage involves moving to a foreign country where the cost of living is lower. For example, someone living in the United States might move to a country like Mexico or Thailand. International geographic arbitrage can be a great option for people who are looking to retire early and are open to new cultural experiences.
Pros:
Lower cost of living
The opportunity to experience new cultures and languages
A chance to live in a more relaxed pace of life
Cons:
Adjusting to a new culture can be difficult
The cost of traveling back and forth to your home country can be high
Dealing with visa and immigration requirements can be time-consuming and confusing
Examples of Affordable Retirement Destinations
Mexico
Thailand
Costa Rica
Panama
Portugal
Conclusion
Retiring early is a dream for many people, but it requires careful planning and execution. Geographic arbitrage, either domestically or internationally, can be a great option for people looking to lower their cost of living and enjoy a more relaxed pace of life. Just be sure to consider the pros and cons of each option and do your research before making a decision. Whether you choose to retire domestically or internationally, the important thing is to find a location that aligns with your values and lifestyle.
*We are not financial advisors and only present our findings. Please do your own due diligence and what you feel you can make work in your own unique situation.