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    Woman learning money lessons after living in Mexico

    Commercial trade between the United States and Mexico is very important for both nations.

    • Just in January 2016, the United States exported $18 billion in goods to Mexico.
       
    • An estimated one million American citizens live in Mexico.
       
    • In 2013, over 20 million U.S. tourists visited Mexico and over 14 million Mexican tourists visited the U.S., spending about $10.5 billion.

    For three years, I had the wonderful opportunity to experience what it is to live in Monterrey, Mexico and learned several important financial lessons that I apply here in the United States. Here are the seven lessons about money that I learned after living in Mexico.

    1. Invest in a College Degree

    Founding Father Ben Franklin said it best: "An investment in knowledge pays the best interest."

    My bachelor’s degree allowed me to land a teaching job at Prepa Tec, the high school system of the Tecnologico de Monterrey university system, which included a fully-funded sponsorship to complete a master’s degree in Education. I was able to complete a postgraduate degree with zero debt and boost my future earnings potential.

    Given that the Millennial generation is much more interested in traveling abroad than older generations, I would advise my peers to invest in a college degree to combine a passion for travel with the opportunity to earn money. (See also: The 3 Best Jobs for Expats and Travelers)

    It's worth mentioning that having at least a bachelor's degree increases your lifetime earnings by $1 million over those from folks with just a high school diploma, and increases your chances of better health, too.

    2. Keep an Eye on Other Currencies

    While living in Mexico, I had to keep a close watch on the U.S. dollar-Mexican peso exchange rate for several reasons. For one, I still had a checking account back in the U.S. and crossed the border several times for shopping and tourism. After a couple months of tracking this number, I learned how to simultaneously buy and sell currencies in order to profit from a difference in the price (also known as "arbitrage").

    By keeping an eye on foreign currencies, you may be able to take advantage of many financial opportunities. For example, for the past two years, the U.S. dollar has appreciated against several currencies, including the Brazilian real, the Chilean peso, and the euro, making your foreign vacation plans much more affordable.

    3. Review Your Employer's Benefits Package

    Working for an educational institution may not sound as sexy as working for a hot startup. However, in my case, it offered me comparable benefits and perks. Established in 1943, the Tecnologico de Monterrey has over 30 campuses in Mexico and 13 campuses abroad. The size of this institution allows it to broker great deals for its employees, including layaway programs, discounts at retailers, and financial services at better rates. I had access to all gyms in the six campuses in Monterrey and was able to purchase a laptop at a discounted price through an automatic payroll deduction program.

    Don't underestimate the ability of your employer to provide you better benefits and take a second look at what you're currently being offered. For example, your employer may provide you an online portal for discounted goods and services, such as electronics and travel options or individual investment advice offered on a one-on-one basis through your retirement plan. Particularly, take ownership of your retirement planning because nearly half of 401K plan owners don't know what their best investment options are.

    4. Check the Fine Print on All Your Contracts

    A credit card agreement, cell phone plan, or other type of contract can go further than you think. While living in Monterrey, I met several U.S. expats that would still use the same credit cards, cell phone plans, or insurance plans from across the border for several reasons. Here are some examples:

    5. File Your Taxes When Living Abroad

    If you were to choose to live in Mexico for three years like I did, your entire family would miss you a lot, particularly your good ol' Uncle Sam. He'd miss you so much that he'd ask you to still check in with him every year. Yes, all U.S. citizens and green card holders are still liable to file their federal tax returns, even when abroad.

    Your worldwide income is subject to U.S. income tax, regardless of where you reside. The good news is that the IRS grants U.S. citizens and resident aliens living outside of the United States and Puerto Rico an automatic two-month extension to file their return (June 18th in 2016). The bad news is that you would still pay interest on any tax not paid by the regular due date of your return (April 18th in 2016). (See also: Filed an Extension? Here's What You Need to Know)

    Because many countries have tax treaties with the U.S., research for applicable treaties, including tax exemptions for certain professions.

    6. Make Your Air Miles Go the Extra Mile

    Before I moved to Mexico, I had accumulated a lot of reward miles — but I had been unable to use them, because of various restrictions and confusing terms. So frustrating!

    In Mexico, the process was a lot simpler, and I soon realized how much further I could travel with my existing air miles within Mexico and to South America. I was able to score a trip from Monterrey, Mexico to Guayaquil, Ecuador (roughly the same distance as a flight from New York to Seattle) for far fewer points for an equivalent trip within the U.S. (See also: 12 Travel Perks You Didn't Know Your Credit Card Had)

    And there's more. You can also redeem frequent flier miles for additional items, including car rentals, hotel stays, magazine subscriptions, and VIP experiences.

    7. Seek Additional Sources of Income

    Before living in Mexico, I had a very traditional view on work: You only have one full-time job. Through my work at Prepa Tec I quickly discovered that lots more opportunities were available to me:

    • My native proficiency in Spanish allowed me to translate a couple of course materials at the college level to English;
       
    • My presentation skills enabled me to become an instructor for a graduate level admissions exam; and
       
    • My computer skills turned out to be great assets to create music sequences for an electro pop band!

    While it may be counterintuitive, people with higher levels of education are more likely to have multiple jobs than those without. For those who aren't able to get a raise, or got the average 3% salary bump, or are looking to boost their budget or savings, secondary sources of income are a good idea. With the rise of the gig economy, there are many ways to make money online that are absolutely legit, including driving your car for Uber or Lyft or becoming a virtual assistant for Zirtual or Fancy Hands.

    What money lessons did you learn after living abroad?

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    Finding countries where you can retire for half the price

    If you're getting close to retirement, but you're planning on working an extra couple of years because you just "don't have the money," think again. Retiring in North America is expensive! Why not live somewhere tropical and exotic for at least half the year and cut your expenses down considerably? In this article I'm going to list five destinations where you can do just that. (See also: 5 Incredible Places to Retire Abroad)

    Note: Costs of food, housing, transportation, and entertainment are compared to New York City using Expatistan's cost of living index.

    1. Mexico

    • Food = 64% cheaper
    • Housing = 83% cheaper
    • Transportation = 72% cheaper
    • Entertainment = 64% cheaper
    • One-bedroom apartment = $300-$500 per month
    • Total cost of living = $1,200+ per month

    If you hear "Mexico" and your mind automatically wanders to an American-owned resort in Cancun with a bartender on the beach and jet skis on rent, you'd be forgiven for thinking that Mexico isn't half the price of home.

    But this isn't Mexico! The real Mexico's not only extremely affordable, but it's rich in culture, history, and natural beauty. You can rent beautiful apartments in retirement havens like San Pancho, Sayulita, and Oaxaca for under $500 a month.

    A dinner out at a nice restaurant with a bottle of wine won't likely cost you more than $10 per person and your grocery bills will be cut in half. Mexico is the perfect place to retire, which is why so many snowbirds head there for half of the year.

    2. Thailand

    • Food = 48% cheaper
    • Housing = 68% cheaper
    • Transportation = 54% cheaper
    • Entertainment = 55% cheaper
    • One-bedroom apartment = $300-$500 per month
    • Total cost of living = $1,000+ per month

    Who doesn't want to spend their golden years in the land of smiles? Thailand is the ultimate budget friendly destination for people looking for a change of scenery in retirement. The above cost of living indexes are compared to Bangkok, Thailand's capital and most expensive city.

    If you choose to live on one of the country's beautiful islands, you could cut these costs down considerably. A nice one or two-bedroom bungalow with a kitchenette, a few blocks from the sea, won't cost you more than $500 and you'd have a hard time paying more than $7 for a local meal.

    Big beers at 7-11 only cost a couple of dollars and you can rent a motorbike here for around $3 a day (less if you rent monthly).

    Thailand is wonderfully exotic, but it still has a lot of the amenities that you'd hope for from home. Good grocery stores, 7-11s, great restaurants, gyms, malls, and excellent accommodation options. Pair this with some of the best beaches in the world, friendly people, and incredibly low prices, and you've got one of the world's top retirement hot spots.

    One downside of Thailand may be that there are a lot of young people and on some of the islands, monthly parties can get out of hand. But aside from the Full Moon Party on Koh Phangan and the water festival in Bangkok, most of Thailand still has a slow-paced tropical charm. Who knows, maybe you're looking for a party during retirement?

    3. Albania

    • Food = 66% cheaper
    • Housing = 84% cheaper
    • Transportation = 67% cheaper
    • Entertainment = 64% cheaper
    • One-bedroom apartment = $300-$500 per month
    • Total cost of living = $1,250+ per month

    Maybe one of the last places you thought you'd visit, let alone live in, Albania has had a turbulent history. Cut off from the world by a brutal communist dictator for nearly a half-century, the country lost much of its reputation as a vacation spot during that time. But today, Albania is moving forward and the people are extremely welcoming.

    Again, the cost of living indexes are comparing New York City to Tirana, Albania's capital, but Tirana is the country's most expensive place to live. Instead, head down to the Albanian Riviera along the Adriatic coast and check out towns like Himara, Vlora, and Saranda. You won't find anywhere else in Europe where you can rent an apartment for $400 per month with a stunning view over the Adriatic sea.

    In Saranda, there's a huge selection of accommodations in skyscraper-style apartment blocks all along the water's edge, while in quieter Vlora and Himara, you won't find as much variety but you can still find well-priced places to stay.

    The Albanian Riviera is known for beautiful beaches, sunny weather, and delicious seafood. You can get a fish dinner at a restaurant overlooking the water for around $10-$15. Albania is definitely affordable and it has a lot of amenities as well.

    Note: Driving in Albania can be frustrating and dangerous. If you do decide to buy or rent a car, however, don't miss the drive between Vlora and Saranda along the coast. It is one of Europe's most scenic road trips.

    4. Malta

    • Food = 32% cheaper
    • Housing = 66% cheaper
    • Transportation = 47% cheaper
    • Entertainment = 43% cheaper
    • One-bedroom apartment = $685-$1,000 per month
    • Total cost of living = $1,750+ per month

    The Brits already know that Malta is the perfect place to retire, but few Americans can even place this tiny Mediterranean island on the map. Located just below Sicily and about 62 miles north of Africa, Malta is the most fascinating country you've never heard of.

    Steeped in a rich history, blessed with azure waters and natural beauty, and inhabited by some of the friendliest people in Europe, Malta might just be the most charming place on this list. It's a bit of a stretch to say that it's half the price of most U.S. cities, but you can get a nice one-bedroom apartment here for around €600 ($685). Food in restaurants is considerably cheaper than in the U.S., as is the local produce and alcohol in grocery stores.

    There are three islands in Malta that are inhabited, but you'll likely choose between Gozo and the main island of Malta. The main island has many more amenities and more areas to explore, but is a lot more built up than the quieter, more natural island of Gozo.

    Whichever island you choose, all are connected by an excellent network of buses and ferries, so you're never more than a couple of hours from anywhere. There are also ferries to nearby Sicily and Malta is well connected to Europe via flights with Air Malta.

    Did I mention that Malta is considered to have the best year-round climate in the world?

    5. Croatia

    • Food = 46% cheaper
    • Housing = 75% cheaper
    • Transportation = 41% cheaper
    • Entertainment = 52% cheaper
    • One-bedroom Apartment = $500-$700 per month
    • Total cost of living = $1,550+ per month

    Another Mediterranean hot spot, Croatia has a few cities that are great for retirement, but in my opinion, Split is the best. The old town has history, a beautiful setting along the Adriatic Sea and great dining options.

    The temperature here never gets below 45°F and in the summer, you have your choice of some of the region's best beaches.

    For history buffs, Diocletian's Palace is one of the best examples of Roman architecture anywhere in Europe and there are numerous old churches, cathedrals, and basilicas to explore.

    Split also has an excellent expat community and there seems to be something going on every week. Whether it's hiking, a music festival, concerts, plays, or beach parties, you'll never get bored in Split. This seaside town pretty much has it all, and you can get it for less than half the price of most cities in the U.S.

    Visit First and Check With the Tax Authorities

    There's a lot more to consider than just the cost of living when choosing the best place for retirement. You want to make sure that your chosen destination has enough amenities and activities to keep you satisfied.

    You'll also want to look into the tax situation to ensure that you don't get into any trouble with the IRS. But this stuff is easier than it sounds. Once you choose the perfect place, head down there for a month or two and see if you enjoy it while staying longer-term.

    There are so many places around the world to choose from and luckily for Americans, many of them are much cheaper than home.

    What's your favorite vacation spot? Could you retire there? Tell us why in the comments below.

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    Couple learning how to retire in Mexico for less

    If you're thinking about retirement, you're not alone. However, out of 100 Americans who start working at age 25, only 4% are expected to have saved enough for retirement at age 65.

    While this number may seem surprisingly low, retiring doesn't have to be as expensive as you may think. If you can lower your monthly income requirement, you can also greatly reduce the total capital that you need to save to retire.

    One easy way to do this: retire abroad. For many Americans, Mexico is a top choice. It's not only geographically close, it's also very affordable. Adventure seekers love its bustling cities full of colonial architecture and rich culture, as well as the natural beauty found along its coastlines and highlands. (See also: Retire for Half the Cost in These 5 Countries)

    If you're worried you might be among the 96% of people who haven't saved enough for retirement, moving to Mexico may be an effective way to make your nest egg go further.

    Cost of Living in Mexico

    The cost of living is drastically lower than in the U.S. or in Canada. According to Numbeo, the cost of living in Mexico is nearly 60% lower than the United States, with rent costing 79% less.

    However, keep in mind that those are costs averaged over the entire country. Expenses are higher in bigger cities such as the capital, and in places that attract a lot of foreigners, such as Playa del Carmen.

    Rental Costs

    Based on my experience living in Mexico City and traveling extensively through the country during 2015 and 2016, I have found rents to be far lower than the U.S. You can find a place for as low as $100 a month in off-the-beaten-track destinations, such as the small beach town of Mazunte. However, a great deal like this often means sacrificing on some of the comforts of home such as air conditioning and hot water.

    On the upper end of the budget, if you're willing to spend $600–$1,000, you can rent a luxury apartment, even in the more expensive and cosmopolitan destinations.

    Health Insurance Costs

    Private health insurance is significantly cheaper in Mexico than in the states. It can cost you as little as 20% of what it would cost in the U.S.

    Because the cost of routine visits and minor incidents is so small, you may also choose to self-insure, which means simply paying for these costs out-of-pocket as opposed to purchasing an insurance plan.

    Doctor Costs

    As with rental prices, the cost of going to the doctor also varies to some extent, so these numbers should only serve as a rough guideline.

    From my experience, a routine teeth cleaning from a dentist costs $15–$20. A regular doctor's visit costs as little as $25 to $50, while a specialist normally costs $35–$50 and up per visit.

    Food Costs: Restaurants and Grocery Shopping

    Groceries in Mexico are about a third of the price of food in the U.S., depending on the season and availability. You can even sometimes find American chains like Wal-Mart, where you can buy cheap groceries.

    Restaurant prices vary, too, based on type. On the lower end, you can visit food stands to get snacks, which Mexicans call antojitos for as little as 50 cents to a dollar. These include tacos, quesadillas, and burritos. Freshly pressed juice and prepared fruit is also in this price range.

    One step up from the food stands are restaurants called fondas. These are small, family-owned establishments that serve two- or three-course meals, including soup or salad, a full entree, and a drink. Sometimes they also come with dessert. Expect to pay $3–$10 dollars.

    A truly gourmet, upscale dining experience should set you back $10–$30.

    Alcohol Costs

    Alcohol in Mexico is widely available, and enjoying tequila or mezcal is a common cultural practice. There are no taboos on drinking, and alcohol is accessible at the local corner store for very affordable prices.

    For a bottle of tequila or mezcal you can expect to pay $10 for a low-quality bottle and up to $40 for an artisanally produced bottle of very good quality alcohol.

    A six-pack of beer starts at $4–$6. There are not as many microbrew options available as in the U.S., but some bars do offer local, small-batch beer, usually priced around $4 a bottle.

    Mexico is an attractive place to retire, not only because it is an affordable option, but because of all that it has to offer, from interesting cultural experiences to the hospitable locals who often go out of their way to make you feel at home.

    Transport Costs

    If you're traveling by plane, prices start around $250 for round-trip tickets to or from the U.S., and $40–$100 for trips within country. Long-distance coaches are an even cheaper alternative to internal flights. An eight-hour basic bus trip costs about $25, varying a bit depending on your destination. You also have the option of paying more for a first-class bus that includes drinks, snacks, entertainment (TV and music), and seats that are designed to be comfortable to sleep in.

    Local transportation options include the bus (on average 50 cents) and, in Mexico City, the Metro (25 cents).

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    How Almost Anyone Can Afford to Retire in Mexico




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    Happy couple enjoying their retirement

    If things go well for you, retirement can last for decades. But your retirement savings might not, especially if you live in a high-cost area. Households with a resident aged 65 or older have a median income of just $38,515, according to the U.S. Census Bureau. It's no wonder that the number of Americans retiring abroad grew 17 percent between 2010 and 2015, now numbering some 400,000, according to the Social Security Administration. (See also: 5 Countries Where You Can Retire for $1,000 a Month)

    But retiring abroad isn't as simple as going on vacation. How will you access your savings or benefits from overseas? Can you buy property? What about medical care? All these questions can be addressed with some pre-takeoff financial planning. (See also: 9 Things to Know Before Retiring Abroad)

    1. Find a retiree-friendly destination

    Some places have incentives like tax breaks and visa offers to attract American retirees, such as Panama and Costa Rica's pensionado programs. You may also qualify for senior citizen benefits established for locals, such as Ecuador's senior discount program, which offers savings on airfare, utilities, and sporting events.

    In addition, it's a good idea to consult the State Department's country-specific information about visa laws, health and safety conditions, and how much money you'd be allowed to bring into the country with you. (See also: 5 Countries That Welcome American Retirees)

    2. Find out if you can get Social Security payments there

    Six in 10 retirees rely on Social Security for at least half their income, according to the Social Security Administration, making this a pretty important consideration. Fortunately, the SSA can send you your check if you move abroad to most countries, with the notable exceptions of Cuba and Cambodia. For certain other countries, including Ukraine, you can get your payments, but only if you meet certain conditions such as appearing at a U.S. embassy or consulate every six months.

    The Social Security Administration offers the Payments Abroad Screening Tool to help you figure out if you'll be able to collect payments overseas.

    If you are a non-U.S. citizen receiving Social Security because you worked in the U.S. or are a dependent of someone who did, the rules on receiving payments overseas are more complicated. Consult the SSA booklet, Your Payments While You Are Outside the United States for the full story.

    Many American embassies worldwide have a Federal Benefits Unit to help retirees with any Social Security issues.

    3. Hire a new financial adviser

    The wave of Americans retiring abroad has given rise to a new specialty in the financial industry: Cross-Border Planning. A cross-border specialist will help you understand local income tax laws so you don't risk over- or underpaying. They can also help you safely move spending money from the U.S. to your new home, and guide you through many other issues you might never have considered.

    It's almost impossible to find someone who knows the laws of every country, so use the Cross-Border Financial Planning Alliance to find someone who specializes in your chosen country.

    4. Figure out what to do with your bank accounts

    You should keep your U.S. bank account open to handle any expenses and bills you have stateside, and open another one in your new home country. Ask your U.S. bank if they charge a fee for making withdrawals from foreign automatic teller machines; if they do, you might want to upgrade your account or change banks before you move.

    For your foreign account, Expat Info Desk recommends choosing a large, well-known bank and transferring your money using an international currency exchange service. These are companies that transfer large amounts of money to an account in a foreign country, and they may offer a better conversion rate. Another option is to ask your home bank if they operate in your destination country.

    If you have more than $10,000 worth of assets in foreign accounts, the IRS notes you must report this to the U.S. government every year by filing a Report of Foreign Bank and Financial Accounts (FBAR) or face penalties of up to $100,000.

    5. Stay on good terms with the U.S. Department of Treasury

    Even though you no longer live in the U.S., if you maintain citizenship, you need to pay taxes. The Internal Revenue Service offers guidance on how and when to file a tax return from overseas.

    Don't imagine that you'll be out of sight, out of mind to the U.S. government. In fact, it's actually more important for you to pay up than it is for citizens living at home, because if you owe more than $50,000 in delinquent payments, you could lose your passport.

    6. Get online

    Although mail service is unreliable in some parts of the world, internet connections are nearly ubiquitous. Even if you have always used paper statements and written checks before, now is a good time to embrace online banking to avoid delays and the cost of international postage.

    7. Rent a home, then learn about buying

    The Australian Expat Investor suggests renting at first, unless you have already been visiting your new country for years and are sure you're there to stay. You'll need to learn about the rules for tenancy in your new country. Don't be surprised if you have to pay an entire year's rent in advance. Even if you don't actually sign a lease before you move abroad, you should put aside the money you'll need and find out how to transfer it.

    Once you're established in your new country, look into whether purchasing a home might be a good financial move. It could cut your costs and serve as an investment if the local property market is on the upswing. (See also: How to Choose the Perfect Country to Retire In)

    8. Tap your U.S. home for income or capital

    If you'll be leaving behind a home you own, you may not want to sell it at first. But you could consider renting out all or part of it. Some retirees use Airbnb to flexibly get income from their U.S. home, while reserving its availability for when they come back to visit. (See also: 5 Easy Ways to Make Good Money From Airbnb)

    If you want to refinance your U.S. property to get money to buy a home overseas, look into doing that before you go. Homeowners who try to refinance from overseas may face a lot more confusing paperwork and hurdles.

    9. Make an estate plan

    If you have never made a will or considered putting assets in a revocable trust, talk to an estate attorney before you go, and get this taken care of. Find a lawyer who is knowledgeable about handling such things while living abroad, so they can advise you on whether your U.S. will can provide for distributing foreign assets, or if you'll need a second will created in your new home country.

    If you already have an estate plan, consult an attorney to see if any amendments will need to be made to cover assets located abroad.

    10. Make a health care plan

    Health care tends to be one of the greatest expenses in retirement. And unlike Social Security, you will not be able to use your Medicare benefits overseas. One decision to make is whether to enroll in Medicare anyway, so that it's still available to you on visits home or if you need to return to the States unexpectedly.

    Since most people don't have to pay a premium for Medicare Part A, which covers domestic hospitalization, some nursing home care, and hospice care, keeping that is a no brainer. Should you also pay for Medicare Part B, which helps pay for doctor visits and some prescriptions, among other expenses? That depends on how likely it is that you will ever return to the United States. If you don't carry Part B, and you must return because you become disabled and need help from your children, for example, you may have to go without coverage for months while waiting for the annual enrollment period, and you may also face premium penalties.

    Since Medicare is off the table for any care you need while overseas, you'll need to plan for financing that. Fortunately, health care in other countries is less expensive than it is in the United States. For example, the average per capita medical spending in Mexico is just over $1,000, compared just under $10,000 in the United States, according to the Organization for Economic Cooperation and Development. So paying for health care expenses out of pocket or buying local insurance or a hospital membership plan may be reasonable, with many expats saying they pay under $100 a month.

    11. Buy insurance for everything else

    Besides your health, you'll also need to insure your property. Understanding what insurance local laws require may be a lot harder in other markets than it is in the United States. It's a good idea to consult your local real estate agent about what insurance policy to get.

    12. Get a financial power of attorney

    You may need an adult son or daughter, or other representative, to make financial moves in your place while you are overseas. It's a good idea to leave them with a financial power of attorney document so that they can sign for you, for example, while selling property or other investments. (See also: What Is Power of Attorney?)

    13. Make an exit plan

    Some retirees plan to enjoy their new home country while their health lasts, then return stateside if they become ill or disabled. If that's you, you'll want domestic long-term care insurance, and/or a nest egg in U.S. accounts to live off when you return. (See also: Is Long Term Care Insurance Worth It?)

    Even if you plan to live in the new country for the rest of your life, if you want your remains returned to the U.S., you'll need to plan for that. Look into emergency evacuation/repatriation insurance to help with medically equipped flights home or transportation of remains.

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    13 Financial Steps to Take Before Retiring Abroad




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    Woman learning money lessons after living in Mexico

    Commercial trade between the United States and Mexico is very important for both nations.

    • Just in January 2016, the United States exported $18 billion in goods to Mexico.
       
    • An estimated one million American citizens live in Mexico.
       
    • In 2013, over 20 million U.S. tourists visited Mexico and over 14 million Mexican tourists visited the U.S., spending about $10.5 billion.

    For three years, I had the wonderful opportunity to experience what it is to live in Monterrey, Mexico and learned several important financial lessons that I apply here in the United States. Here are the seven lessons about money that I learned after living in Mexico.

    1. Invest in a College Degree

    Founding Father Ben Franklin said it best: "An investment in knowledge pays the best interest."

    My bachelor’s degree allowed me to land a teaching job at Prepa Tec, the high school system of the Tecnologico de Monterrey university system, which included a fully-funded sponsorship to complete a master’s degree in Education. I was able to complete a postgraduate degree with zero debt and boost my future earnings potential.

    Given that the Millennial generation is much more interested in traveling abroad than older generations, I would advise my peers to invest in a college degree to combine a passion for travel with the opportunity to earn money. (See also: The 3 Best Jobs for Expats and Travelers)

    It's worth mentioning that having at least a bachelor's degree increases your lifetime earnings by $1 million over those from folks with just a high school diploma, and increases your chances of better health, too.

    2. Keep an Eye on Other Currencies

    While living in Mexico, I had to keep a close watch on the U.S. dollar-Mexican peso exchange rate for several reasons. For one, I still had a checking account back in the U.S. and crossed the border several times for shopping and tourism. After a couple months of tracking this number, I learned how to simultaneously buy and sell currencies in order to profit from a difference in the price (also known as "arbitrage").

    By keeping an eye on foreign currencies, you may be able to take advantage of many financial opportunities. For example, for the past two years, the U.S. dollar has appreciated against several currencies, including the Brazilian real, the Chilean peso, and the euro, making your foreign vacation plans much more affordable.

    3. Review Your Employer's Benefits Package

    Working for an educational institution may not sound as sexy as working for a hot startup. However, in my case, it offered me comparable benefits and perks. Established in 1943, the Tecnologico de Monterrey has over 30 campuses in Mexico and 13 campuses abroad. The size of this institution allows it to broker great deals for its employees, including layaway programs, discounts at retailers, and financial services at better rates. I had access to all gyms in the six campuses in Monterrey and was able to purchase a laptop at a discounted price through an automatic payroll deduction program.

    Don't underestimate the ability of your employer to provide you better benefits and take a second look at what you're currently being offered. For example, your employer may provide you an online portal for discounted goods and services, such as electronics and travel options or individual investment advice offered on a one-on-one basis through your retirement plan. Particularly, take ownership of your retirement planning because nearly half of 401K plan owners don't know what their best investment options are.

    4. Check the Fine Print on All Your Contracts

    A credit card agreement, cell phone plan, or other type of contract can go further than you think. While living in Monterrey, I met several U.S. expats that would still use the same credit cards, cell phone plans, or insurance plans from across the border for several reasons. Here are some examples:

    5. File Your Taxes When Living Abroad

    If you were to choose to live in Mexico for three years like I did, your entire family would miss you a lot, particularly your good ol' Uncle Sam. He'd miss you so much that he'd ask you to still check in with him every year. Yes, all U.S. citizens and green card holders are still liable to file their federal tax returns, even when abroad.

    Your worldwide income is subject to U.S. income tax, regardless of where you reside. The good news is that the IRS grants U.S. citizens and resident aliens living outside of the United States and Puerto Rico an automatic two-month extension to file their return (June 18th in 2016). The bad news is that you would still pay interest on any tax not paid by the regular due date of your return (April 18th in 2016). (See also: Filed an Extension? Here's What You Need to Know)

    Because many countries have tax treaties with the U.S., research for applicable treaties, including tax exemptions for certain professions.

    6. Make Your Air Miles Go the Extra Mile

    Before I moved to Mexico, I had accumulated a lot of reward miles — but I had been unable to use them, because of various restrictions and confusing terms. So frustrating!

    In Mexico, the process was a lot simpler, and I soon realized how much further I could travel with my existing air miles within Mexico and to South America. I was able to score a trip from Monterrey, Mexico to Guayaquil, Ecuador (roughly the same distance as a flight from New York to Seattle) for far fewer points for an equivalent trip within the U.S. (See also: 12 Travel Perks You Didn't Know Your Credit Card Had)

    And there's more. You can also redeem frequent flier miles for additional items, including car rentals, hotel stays, magazine subscriptions, and VIP experiences.

    7. Seek Additional Sources of Income

    Before living in Mexico, I had a very traditional view on work: You only have one full-time job. Through my work at Prepa Tec I quickly discovered that lots more opportunities were available to me:

    • My native proficiency in Spanish allowed me to translate a couple of course materials at the college level to English;
       
    • My presentation skills enabled me to become an instructor for a graduate level admissions exam; and
       
    • My computer skills turned out to be great assets to create music sequences for an electro pop band!

    While it may be counterintuitive, people with higher levels of education are more likely to have multiple jobs than those without. For those who aren't able to get a raise, or got the average 3% salary bump, or are looking to boost their budget or savings, secondary sources of income are a good idea. With the rise of the gig economy, there are many ways to make money online that are absolutely legit, including driving your car for Uber or Lyft or becoming a virtual assistant for Zirtual or Fancy Hands.

    What money lessons did you learn after living abroad?

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    Finding countries where you can retire for half the price

    If you're getting close to retirement, but you're planning on working an extra couple of years because you just "don't have the money," think again. Retiring in North America is expensive! Why not live somewhere tropical and exotic for at least half the year and cut your expenses down considerably? In this article I'm going to list five destinations where you can do just that. (See also: 5 Incredible Places to Retire Abroad)

    Note: Costs of food, housing, transportation, and entertainment are compared to New York City using Expatistan's cost of living index.

    1. Mexico

    • Food = 64% cheaper
    • Housing = 83% cheaper
    • Transportation = 72% cheaper
    • Entertainment = 64% cheaper
    • One-bedroom apartment = $300-$500 per month
    • Total cost of living = $1,200+ per month

    If you hear "Mexico" and your mind automatically wanders to an American-owned resort in Cancun with a bartender on the beach and jet skis on rent, you'd be forgiven for thinking that Mexico isn't half the price of home.

    But this isn't Mexico! The real Mexico's not only extremely affordable, but it's rich in culture, history, and natural beauty. You can rent beautiful apartments in retirement havens like San Pancho, Sayulita, and Oaxaca for under $500 a month.

    A dinner out at a nice restaurant with a bottle of wine won't likely cost you more than $10 per person and your grocery bills will be cut in half. Mexico is the perfect place to retire, which is why so many snowbirds head there for half of the year.

    2. Thailand

    • Food = 48% cheaper
    • Housing = 68% cheaper
    • Transportation = 54% cheaper
    • Entertainment = 55% cheaper
    • One-bedroom apartment = $300-$500 per month
    • Total cost of living = $1,000+ per month

    Who doesn't want to spend their golden years in the land of smiles? Thailand is the ultimate budget friendly destination for people looking for a change of scenery in retirement. The above cost of living indexes are compared to Bangkok, Thailand's capital and most expensive city.

    If you choose to live on one of the country's beautiful islands, you could cut these costs down considerably. A nice one or two-bedroom bungalow with a kitchenette, a few blocks from the sea, won't cost you more than $500 and you'd have a hard time paying more than $7 for a local meal.

    Big beers at 7-11 only cost a couple of dollars and you can rent a motorbike here for around $3 a day (less if you rent monthly).

    Thailand is wonderfully exotic, but it still has a lot of the amenities that you'd hope for from home. Good grocery stores, 7-11s, great restaurants, gyms, malls, and excellent accommodation options. Pair this with some of the best beaches in the world, friendly people, and incredibly low prices, and you've got one of the world's top retirement hot spots.

    One downside of Thailand may be that there are a lot of young people and on some of the islands, monthly parties can get out of hand. But aside from the Full Moon Party on Koh Phangan and the water festival in Bangkok, most of Thailand still has a slow-paced tropical charm. Who knows, maybe you're looking for a party during retirement?

    3. Albania

    • Food = 66% cheaper
    • Housing = 84% cheaper
    • Transportation = 67% cheaper
    • Entertainment = 64% cheaper
    • One-bedroom apartment = $300-$500 per month
    • Total cost of living = $1,250+ per month

    Maybe one of the last places you thought you'd visit, let alone live in, Albania has had a turbulent history. Cut off from the world by a brutal communist dictator for nearly a half-century, the country lost much of its reputation as a vacation spot during that time. But today, Albania is moving forward and the people are extremely welcoming.

    Again, the cost of living indexes are comparing New York City to Tirana, Albania's capital, but Tirana is the country's most expensive place to live. Instead, head down to the Albanian Riviera along the Adriatic coast and check out towns like Himara, Vlora, and Saranda. You won't find anywhere else in Europe where you can rent an apartment for $400 per month with a stunning view over the Adriatic sea.

    In Saranda, there's a huge selection of accommodations in skyscraper-style apartment blocks all along the water's edge, while in quieter Vlora and Himara, you won't find as much variety but you can still find well-priced places to stay.

    The Albanian Riviera is known for beautiful beaches, sunny weather, and delicious seafood. You can get a fish dinner at a restaurant overlooking the water for around $10-$15. Albania is definitely affordable and it has a lot of amenities as well.

    Note: Driving in Albania can be frustrating and dangerous. If you do decide to buy or rent a car, however, don't miss the drive between Vlora and Saranda along the coast. It is one of Europe's most scenic road trips.

    4. Malta

    • Food = 32% cheaper
    • Housing = 66% cheaper
    • Transportation = 47% cheaper
    • Entertainment = 43% cheaper
    • One-bedroom apartment = $685-$1,000 per month
    • Total cost of living = $1,750+ per month

    The Brits already know that Malta is the perfect place to retire, but few Americans can even place this tiny Mediterranean island on the map. Located just below Sicily and about 62 miles north of Africa, Malta is the most fascinating country you've never heard of.

    Steeped in a rich history, blessed with azure waters and natural beauty, and inhabited by some of the friendliest people in Europe, Malta might just be the most charming place on this list. It's a bit of a stretch to say that it's half the price of most U.S. cities, but you can get a nice one-bedroom apartment here for around €600 ($685). Food in restaurants is considerably cheaper than in the U.S., as is the local produce and alcohol in grocery stores.

    There are three islands in Malta that are inhabited, but you'll likely choose between Gozo and the main island of Malta. The main island has many more amenities and more areas to explore, but is a lot more built up than the quieter, more natural island of Gozo.

    Whichever island you choose, all are connected by an excellent network of buses and ferries, so you're never more than a couple of hours from anywhere. There are also ferries to nearby Sicily and Malta is well connected to Europe via flights with Air Malta.

    Did I mention that Malta is considered to have the best year-round climate in the world?

    5. Croatia

    • Food = 46% cheaper
    • Housing = 75% cheaper
    • Transportation = 41% cheaper
    • Entertainment = 52% cheaper
    • One-bedroom Apartment = $500-$700 per month
    • Total cost of living = $1,550+ per month

    Another Mediterranean hot spot, Croatia has a few cities that are great for retirement, but in my opinion, Split is the best. The old town has history, a beautiful setting along the Adriatic Sea and great dining options.

    The temperature here never gets below 45°F and in the summer, you have your choice of some of the region's best beaches.

    For history buffs, Diocletian's Palace is one of the best examples of Roman architecture anywhere in Europe and there are numerous old churches, cathedrals, and basilicas to explore.

    Split also has an excellent expat community and there seems to be something going on every week. Whether it's hiking, a music festival, concerts, plays, or beach parties, you'll never get bored in Split. This seaside town pretty much has it all, and you can get it for less than half the price of most cities in the U.S.

    Visit First and Check With the Tax Authorities

    There's a lot more to consider than just the cost of living when choosing the best place for retirement. You want to make sure that your chosen destination has enough amenities and activities to keep you satisfied.

    You'll also want to look into the tax situation to ensure that you don't get into any trouble with the IRS. But this stuff is easier than it sounds. Once you choose the perfect place, head down there for a month or two and see if you enjoy it while staying longer-term.

    There are so many places around the world to choose from and luckily for Americans, many of them are much cheaper than home.

    What's your favorite vacation spot? Could you retire there? Tell us why in the comments below.

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    Couple learning how to retire in Mexico for less

    If you're thinking about retirement, you're not alone. However, out of 100 Americans who start working at age 25, only 4% are expected to have saved enough for retirement at age 65.

    While this number may seem surprisingly low, retiring doesn't have to be as expensive as you may think. If you can lower your monthly income requirement, you can also greatly reduce the total capital that you need to save to retire.

    One easy way to do this: retire abroad. For many Americans, Mexico is a top choice. It's not only geographically close, it's also very affordable. Adventure seekers love its bustling cities full of colonial architecture and rich culture, as well as the natural beauty found along its coastlines and highlands. (See also: Retire for Half the Cost in These 5 Countries)

    If you're worried you might be among the 96% of people who haven't saved enough for retirement, moving to Mexico may be an effective way to make your nest egg go further.

    Cost of Living in Mexico

    The cost of living is drastically lower than in the U.S. or in Canada. According to Numbeo, the cost of living in Mexico is nearly 60% lower than the United States, with rent costing 79% less.

    However, keep in mind that those are costs averaged over the entire country. Expenses are higher in bigger cities such as the capital, and in places that attract a lot of foreigners, such as Playa del Carmen.

    Rental Costs

    Based on my experience living in Mexico City and traveling extensively through the country during 2015 and 2016, I have found rents to be far lower than the U.S. You can find a place for as low as $100 a month in off-the-beaten-track destinations, such as the small beach town of Mazunte. However, a great deal like this often means sacrificing on some of the comforts of home such as air conditioning and hot water.

    On the upper end of the budget, if you're willing to spend $600–$1,000, you can rent a luxury apartment, even in the more expensive and cosmopolitan destinations.

    Health Insurance Costs

    Private health insurance is significantly cheaper in Mexico than in the states. It can cost you as little as 20% of what it would cost in the U.S.

    Because the cost of routine visits and minor incidents is so small, you may also choose to self-insure, which means simply paying for these costs out-of-pocket as opposed to purchasing an insurance plan.

    Doctor Costs

    As with rental prices, the cost of going to the doctor also varies to some extent, so these numbers should only serve as a rough guideline.

    From my experience, a routine teeth cleaning from a dentist costs $15–$20. A regular doctor's visit costs as little as $25 to $50, while a specialist normally costs $35–$50 and up per visit.

    Food Costs: Restaurants and Grocery Shopping

    Groceries in Mexico are about a third of the price of food in the U.S., depending on the season and availability. You can even sometimes find American chains like Wal-Mart, where you can buy cheap groceries.

    Restaurant prices vary, too, based on type. On the lower end, you can visit food stands to get snacks, which Mexicans call antojitos for as little as 50 cents to a dollar. These include tacos, quesadillas, and burritos. Freshly pressed juice and prepared fruit is also in this price range.

    One step up from the food stands are restaurants called fondas. These are small, family-owned establishments that serve two- or three-course meals, including soup or salad, a full entree, and a drink. Sometimes they also come with dessert. Expect to pay $3–$10 dollars.

    A truly gourmet, upscale dining experience should set you back $10–$30.

    Alcohol Costs

    Alcohol in Mexico is widely available, and enjoying tequila or mezcal is a common cultural practice. There are no taboos on drinking, and alcohol is accessible at the local corner store for very affordable prices.

    For a bottle of tequila or mezcal you can expect to pay $10 for a low-quality bottle and up to $40 for an artisanally produced bottle of very good quality alcohol.

    A six-pack of beer starts at $4–$6. There are not as many microbrew options available as in the U.S., but some bars do offer local, small-batch beer, usually priced around $4 a bottle.

    Mexico is an attractive place to retire, not only because it is an affordable option, but because of all that it has to offer, from interesting cultural experiences to the hospitable locals who often go out of their way to make you feel at home.

    Transport Costs

    If you're traveling by plane, prices start around $250 for round-trip tickets to or from the U.S., and $40–$100 for trips within country. Long-distance coaches are an even cheaper alternative to internal flights. An eight-hour basic bus trip costs about $25, varying a bit depending on your destination. You also have the option of paying more for a first-class bus that includes drinks, snacks, entertainment (TV and music), and seats that are designed to be comfortable to sleep in.

    Local transportation options include the bus (on average 50 cents) and, in Mexico City, the Metro (25 cents).

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    How Almost Anyone Can Afford to Retire in Mexico




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    Happy couple enjoying their retirement

    If things go well for you, retirement can last for decades. But your retirement savings might not, especially if you live in a high-cost area. Households with a resident aged 65 or older have a median income of just $38,515, according to the U.S. Census Bureau. It's no wonder that the number of Americans retiring abroad grew 17 percent between 2010 and 2015, now numbering some 400,000, according to the Social Security Administration. (See also: 5 Countries Where You Can Retire for $1,000 a Month)

    But retiring abroad isn't as simple as going on vacation. How will you access your savings or benefits from overseas? Can you buy property? What about medical care? All these questions can be addressed with some pre-takeoff financial planning. (See also: 9 Things to Know Before Retiring Abroad)

    1. Find a retiree-friendly destination

    Some places have incentives like tax breaks and visa offers to attract American retirees, such as Panama and Costa Rica's pensionado programs. You may also qualify for senior citizen benefits established for locals, such as Ecuador's senior discount program, which offers savings on airfare, utilities, and sporting events.

    In addition, it's a good idea to consult the State Department's country-specific information about visa laws, health and safety conditions, and how much money you'd be allowed to bring into the country with you. (See also: 5 Countries That Welcome American Retirees)

    2. Find out if you can get Social Security payments there

    Six in 10 retirees rely on Social Security for at least half their income, according to the Social Security Administration, making this a pretty important consideration. Fortunately, the SSA can send you your check if you move abroad to most countries, with the notable exceptions of Cuba and Cambodia. For certain other countries, including Ukraine, you can get your payments, but only if you meet certain conditions such as appearing at a U.S. embassy or consulate every six months.

    The Social Security Administration offers the Payments Abroad Screening Tool to help you figure out if you'll be able to collect payments overseas.

    If you are a non-U.S. citizen receiving Social Security because you worked in the U.S. or are a dependent of someone who did, the rules on receiving payments overseas are more complicated. Consult the SSA booklet, Your Payments While You Are Outside the United States for the full story.

    Many American embassies worldwide have a Federal Benefits Unit to help retirees with any Social Security issues.

    3. Hire a new financial adviser

    The wave of Americans retiring abroad has given rise to a new specialty in the financial industry: Cross-Border Planning. A cross-border specialist will help you understand local income tax laws so you don't risk over- or underpaying. They can also help you safely move spending money from the U.S. to your new home, and guide you through many other issues you might never have considered.

    It's almost impossible to find someone who knows the laws of every country, so use the Cross-Border Financial Planning Alliance to find someone who specializes in your chosen country.

    4. Figure out what to do with your bank accounts

    You should keep your U.S. bank account open to handle any expenses and bills you have stateside, and open another one in your new home country. Ask your U.S. bank if they charge a fee for making withdrawals from foreign automatic teller machines; if they do, you might want to upgrade your account or change banks before you move.

    For your foreign account, Expat Info Desk recommends choosing a large, well-known bank and transferring your money using an international currency exchange service. These are companies that transfer large amounts of money to an account in a foreign country, and they may offer a better conversion rate. Another option is to ask your home bank if they operate in your destination country.

    If you have more than $10,000 worth of assets in foreign accounts, the IRS notes you must report this to the U.S. government every year by filing a Report of Foreign Bank and Financial Accounts (FBAR) or face penalties of up to $100,000.

    5. Stay on good terms with the U.S. Department of Treasury

    Even though you no longer live in the U.S., if you maintain citizenship, you need to pay any taxes you owe. The Internal Revenue Service offers guidance on how and when to file a tax return from overseas.

    Don't imagine that you'll be out of sight, out of mind to the U.S. government. In fact, it's actually more important for you to pay up than it is for citizens living at home, because if you owe more than $50,000 in delinquent payments, you could lose your passport.

    6. Get online

    Although mail service is unreliable in some parts of the world, internet connections are nearly ubiquitous. Even if you have always used paper statements and written checks before, now is a good time to embrace online banking to avoid delays and the cost of international postage.

    7. Rent a home, then learn about buying

    The Australian Expat Investor suggests renting at first, unless you have already been visiting your new country for years and are sure you're there to stay. You'll need to learn about the rules for tenancy in your new country. Don't be surprised if you have to pay an entire year's rent in advance. Even if you don't actually sign a lease before you move abroad, you should put aside the money you'll need and find out how to transfer it.

    Once you're established in your new country, look into whether purchasing a home might be a good financial move. It could cut your costs and serve as an investment if the local property market is on the upswing. (See also: How to Choose the Perfect Country to Retire In)

    8. Tap your U.S. home for income or capital

    If you'll be leaving behind a home you own, you may not want to sell it at first. But you could consider renting out all or part of it. Some retirees use Airbnb to flexibly get income from their U.S. home, while reserving its availability for when they come back to visit. (See also: 5 Easy Ways to Make Good Money From Airbnb)

    If you want to refinance your U.S. property to get money to buy a home overseas, look into doing that before you go. Homeowners who try to refinance from overseas may face a lot more confusing paperwork and hurdles.

    9. Make an estate plan

    If you have never made a will or considered putting assets in a revocable trust, talk to an estate attorney before you go, and get this taken care of. Find a lawyer who is knowledgeable about handling such things while living abroad, so they can advise you on whether your U.S. will can provide for distributing foreign assets, or if you'll need a second will created in your new home country.

    If you already have an estate plan, consult an attorney to see if any amendments will need to be made to cover assets located abroad.

    10. Make a health care plan

    Health care tends to be one of the greatest expenses in retirement. And unlike Social Security, you will not be able to use your Medicare benefits overseas. One decision to make is whether to enroll in Medicare anyway, so that it's still available to you on visits home or if you need to return to the States unexpectedly.

    Since most people don't have to pay a premium for Medicare Part A, which covers domestic hospitalization, some nursing home care, and hospice care, keeping that is a no brainer. Should you also pay for Medicare Part B, which helps pay for doctor visits and some prescriptions, among other expenses? That depends on how likely it is that you will ever return to the United States. If you don't carry Part B, and you must return because you become disabled and need help from your children, for example, you may have to go without coverage for months while waiting for the annual enrollment period, and you may also face premium penalties.

    Since Medicare is off the table for any care you need while overseas, you'll need to plan for financing that. Fortunately, health care in other countries is less expensive than it is in the United States. For example, the average per capita medical spending in Mexico is just over $1,000, compared just under $10,000 in the United States, according to the Organization for Economic Cooperation and Development. So paying for health care expenses out of pocket or buying local insurance or a hospital membership plan may be reasonable, with many expats saying they pay under $100 a month.

    11. Buy insurance for everything else

    Besides your health, you'll also need to insure your property. Understanding what insurance local laws require may be a lot harder in other markets than it is in the United States. It's a good idea to consult your local real estate agent about what insurance policy to get.

    12. Get a financial power of attorney

    You may need an adult son or daughter, or other representative, to make financial moves in your place while you are overseas. It's a good idea to leave them with a financial power of attorney document so that they can sign for you, for example, while selling property or other investments. (See also: What Is Power of Attorney?)

    13. Make an exit plan

    Some retirees plan to enjoy their new home country while their health lasts, then return stateside if they become ill or disabled. If that's you, you'll want domestic long-term care insurance, and/or a nest egg in U.S. accounts to live off when you return. (See also: Is Long Term Care Insurance Worth It?)

    Even if you plan to live in the new country for the rest of your life, if you want your remains returned to the U.S., you'll need to plan for that. Look into emergency evacuation/repatriation insurance to help with medically equipped flights home or transportation of remains.

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    13 Financial Steps to Take Before Retiring Abroad