From the “Ultimate guide to retirement – Should I retire to another country?” Published online January, 2009
If you’re worried that you’ll outlive your money. The cost of living in many foreign countries is much lower than that in the U.S. That means your retirement kitty can last longer. But there are many factors to consider. Some include: Taxes. Many countries have tax treaties with the U.S. that help to reduce the chances you’ll be taxed twice. (Google expat sites for a given country and you’ll find the info you need.) But even if you’re living abroad full time, you’ll still have to file a U.S. tax return. If you work in retirement while you’re living overseas, you can claim the Foreign Earned Income Tax Credit. In 2008 this allows you to exclude the first $87,600 you earn in the foreign country from U.S. taxes. Earn more than that amount and Uncle Sam is going to take his cut of your earnings. Pension income from U.S. sources is also going to be taxed, no matter where in the world you happen to be living. Health care. It’s a big issue – and potentially a big problem. Despite all the draw
