Social Security is in the news this week, thanks to its announcement that the agency will not be increasing benefits next year. No cost-of-living adjustment (COLA) for 2016...
Not from the Social Security Administration, maybe, but you could create your own cost-of-living adjustment... by taking your retirement on the road.
No matter how much you're earning from Social Security each month, it'll afford you a whole lot more in key places around the world. You could reduce your cost of living by 20%, 30%, 50%, or more, supercharging every Social Security dollar you do receive.
Retirees Peg Fairbairn and April Hess have done it. These ladies did the math. In Austin, Texas, where they had been living and working, their cost of living in retirement was going to add up to a whopping $5,260 a month. Whose Social Security income supports that? Not Peg and April's.
These two ladies took control of their situation and their retirement future by high-tailing it out of Austin and heading south to Panama, where they've now living the coastal retirement of their dreams on a budget of $1,500 per month.
Where else could your non-COLA Social Security check buy you the retirement you want rather than the retirement you're stuck with? Here's a sampler of non-COLA-friendly retirement havens I strongly urge you to consider if you're looking for options for rescuing your retirement. A couple could retire in all of these places on as little as $1,000 per month or even less:
Granada, Nicaragua: The oldest city in the Americas and one of the most romantic cities in the world, colonial Granada is a jewel of a town that is also home to an established and welcoming community of expat retirees. In addition, Nicaragua currently offers the most affordable retiree residency program in the world. And, despite what you may have read and what your friends and family may insist, Nicaragua is safe. It's also beautiful with a Pacific coastline to rival the best of southern California.
Cuenca, Ecuador: One of the best-known retire overseas options is also one of the most affordable. Like Granada, Cuenca is a Spanish-colonial city that has attracted a big number of foreign retirees thanks to its great weather, city amenities, and low cost of living and of housing.
Chiang Mai, Thailand: Chiang Mai has been luring expats from the West since the 1800s. About 435 miles north of Bangkok, Chiang Mai is nestled in a fertile river valley surrounded by mountains and enjoys a more temperate climate than other parts of Thailand. It's an area rich in history with a culture distinctly different than central and southern Thailand.
Cebu, Philippines: Cebu City, capital of Cebu Island, is a busy, vibrant place and the commercial hub of the Visayan Islands. Outside the city are some of the most beautiful natural landscapes in the world, including narrow coastlines with bright blue waters and limestone plateaus offset by rolling hills and rugged mountains. Cebu is protected by outer lying islands from the fierce typhoon winds that beat on some parts of these islands most years. Winter in Cebu (October to February) can be delightful; temperatures are about 75 degrees Fahrenheit and accompanied by gentle breezes. Expats in Cebu come from all over the world and include good numbers of men aged 45 to their mid-60s who've sought out Cebu so their pensions will stretch much further than they would back home and, often, to restart their lives with new wives and new families. It helps that English is an official language of the Philippines.
If your retirement budget stretches a little further (to, say, $1,500 per month), you could add these also appealing destinations to your dream list:
Note that your good options for living well in retirement even on a modest and non-COLA Social Security income include beautiful, welcoming, and exotic choices in the Americas, Southeast Asia, and, yes, even Europe. Thanks to the roaring, soaring Greenback, more of the Old World is more affordable right now than it's been in a long time.
No COLA? No problem.