Retire Overseas? Don’t be fooled by the falling dollar it can still make sense

With the rising cost of living in Australia more retirees are eyeing up the much lower costs and what can be comparable health care standards of South East Asia.

The push is also fuelled by concerns about the inadequacy of average superannuation balances to provide for a comfortable retirement and tighter eligibility conditions around pensions.

While the value of the Aussie dollar has plummeted against the US $ the good news for such ‘Silver Surfers’ is that it has more than held its own against the currencies of popular destinations such as Malaysia and Indonesia.

The options on our geographical doorstep are certainly tempting. In Vietnam and Cambodia Aussie retirees can live like kings or queens cheaply on tourist visas.

There are greying communities in Thailand’s Phuket island and also Bali. Some live in gated communities away from the crowds and others in units in the very thick of it.

In Malaysia there’s even special ten-year ‘My Second Home’ renewable visas. You must be over 50, put $32,000 into a long term bond and buy a property above $325,000 .

Many dreaming of this kind of retirement, given the increasing costs of living in Australia, may have been put off  making plans given the plunging value of A$.

But Stephen Wyatt, who with his wife Colleen Ryan, wrote the key book on the subject Sell Up, Pack Up and Take Off says our dollar has more than held its own against some Asian currencies.

It’s up against the Malaysian ringgit and the Indonesia rupiah meaning the already substantially lower costs in those nations are cheaper still.

“There’s a natural hedge which benefits Australian retirees,” Stephen says. “ Malaysia and Indonesia like Australia are resource rich economies. When prices go down for resources so do both our and their currencies which means the relative low costs there remain.”

Even in Thailand where the baht is a bit higher he quotes rents in regional Chang Mai as being 75% less than Australia and throughout the SE Asian region meals, beers and groceries being similarly low.

Stephen, whose website www.planet-boomer.com has more information,  says despite the consumer price index in Australia indicating prices are steady more older people are feeling the pinch.

There are however two key issues to consider before you head off to the airport and bid the family a fond farewell. They are medical standards and pension restrictions.

In Malaysia, where English is most widely spoken, there are top class and affordable hospitals and medical centres in particular in the big cities.

But you need to choose carefully as the conditions in such facilities are not universally high.

If you are eligible for the pension check out how long you can remain overseas and continue to get paid. You also need to do your homework around super and tax issues.

The majority of Australian retirees who leave the country still go to nations like Italy and Greece. And only 700 of the 28,000 people taking up the Malaysian retirement visa are Australia.

But the tide seems to be turning with more older Australians both considering and taking up the option of living at least part of their retirement where there money goes much further.