Retiring overseas: Answering readers' big questions

There’s a romantic appeal to living abroad in retirement, as well as a practical one.
A growing number of American retirees have already moved to foreign lands, and plenty more are looking to do so. Lower cost of living, slower pace, new adventures, and more recently, a quieter political atmosphere are all part of the appeal.
My recent column highlighting this trend prompted hundreds of you to share your views and pose key questions.
The following is an edited Q & A about the two pillars of retirement finances for anyone considering moving abroad: healthcare and Social Security.
The cost of healthcare
Healthcare is a big one for us. Countries with universal healthcare cut the risk of you going broke due to major illness. Even private insurance in many countries is cheaper and better risk-wise.
Healthcare in the US carries serious potential sting in retirement. Out-of-pocket medical expenses for retirees catch many people by surprise.
A 65-year-old man with traditional Medicare who is enrolled in a Medigap plan with average premiums will need to have saved $212,000 to have a 90% chance of having enough to cover premiums and median prescription drug expenditures, and a 65-year-old woman will need to have saved $252,000, according to a new report from the Employee Benefit Research Institute (EBRI).
There are numerous factors that will determine how that figure will tally up for you — your gender, how healthy you are, where you live, and how many years you will live.
While it’s generally true that healthcare costs are lower in other countries, it’s not a simple task to get set up for medical care in a new country.
Do your footwork. To get a lay of the land before you pick up stakes, reach out to other retirees and friends you know who are living in the town or city you’re eyeing. Ask what they do for health insurance, doctors, hospitals, and pharmacies and get their advice.
Expats can typically tap into low-cost universal coverage offered by local government-funded health systems or enroll in private insurance options.
Many relocation experts I spoke to advise signing up for a private policy from a national or international insurance company at least initially. Here’s why: Many countries require you to have medical coverage as a condition for obtaining a visa, and it can take time to become eligible for the public health service.
Some insurers offering international plans include Cigna Global, GeoBlue (Blue Cross Blue Shield Global Solutions), Allianz Care, and International Medical Group (IMG).
Resources for your research. The World Health Organization provides country-by-country data on factors such as the ratio of doctors to population. And Joint Commission International (JCI), a global healthcare nonprofit, provides an accredited list of medical centers in countries worldwide. International Living's 2026 Annual Global Retirement Index also provides detailed healthcare information on various popular regions.
Be prepared for language hiccups. While many medical professionals working outside the US speak English, especially if they’re practicing in a popular expat town, you want to be sure nothing gets lost in translation. International health insurers should be able to steer you to English-speaking providers, or check with the US embassy in the country for suggestions.
A translation app on your phone can also come in handy.
Do those who move to a foreign country for retirement still pay Medicare premiums? If they “permanently” move out of the country, would they still have to pay the premium, assuming they'll never come back here?
Although many retirees head overseas for numerous years, it’s not unusual to boomerang back to the US to be closer to family, especially if they require special medical care as they age.
“This is a difficult decision for people who are living abroad in retirement,” Kim Lankford, author of the new book “Medicare 101,” told me.
“Medicare rarely covers any care outside the US, so if you do sign up, you’ll be paying Part B premiums for coverage you can’t benefit from while abroad. Most people don’t pay premiums for Part A, so there’s less of a downside to signing up for that,” she said.
But if you don’t sign up, you won’t have coverage if you travel back to the US and need medical care.
Here’s another sticky point: You can only sign up for Part B at certain times, and you might have to pay a Part B late enrollment penalty if you eventually move back to the US and want to enroll in Medicare, she said.
This penalty is 10% of the standard Part B premium for each 12-month period when you could have had Part B but didn’t — which for most people would be since their initial enrollment period at 65.
Medicare Advantage plans generally require you to reside in the US and will drop you if you move abroad permanently. For more help, check out Medicare’s booklet.
Social Security benefits
Does your SSA check get deposited in a US bank or a bank where you have relocated?
If you pick the local bank in the country where you now live, you’ll need to confirm that country has an international direct deposit agreement with the US. Here’s the list of countries and territories that allow direct deposit payments.
You must notify the Social Security Administration when you move abroad. You'll receive a questionnaire every one to two years to confirm your address and status, which must be returned to avoid suspension.
Do I still pay taxes on Social Security benefits if I am living in another country?
Yes. If you are a US citizen, you’re subject to US income tax laws no matter where you live. This means that your income, including up to 85% of the Social Security benefits you get, may be subject to federal income tax.
Keep in mind that if you’re living abroad and earning income even from a part-time gig, your Social Security income limits remain the same as if you were working in the US. In general, if you’re between age 62 and your full retirement age, earn over $24,480 (the limit is adjusted annually), and collect Social Security, the administration will withhold $1 for every $2 over that limit.
The withheld benefits are not lost. Social Security recalculates monthly benefits when you reach full retirement age and gives you back the withheld benefits.
There is another wrinkle to consider: If you’re receiving Social Security benefits and are younger than full retirement age, SSA will withhold your benefits for each month you work more than 45 hours outside the United States and you’re not subject to US Social Security taxes. Check out the SSA's How Work Affects Your Benefits.