You might have often dreamed about your retirement. You would have thought about making enough money to settle down in a beautiful location, in a home that caters to all your needs, and indulging in hobbies that you could not find time for.
However, the global economic downturn has forced people to re-think their earlier plans. You may have planned to sell your house to move to a better place but house prices have dropped and it would be hard to get a good deal now. Even so, you can reassess your needs and prioritise them to ensure that you can still have a good life after all those years of hard work.
First of all, you need to think about the ideal location and its proximity to your present home. These days, the trend leans towards retiring in a place where you know where to go to for all your needs. Moreover, if you move to a place that is too far away, you would have to make huge relocation expenses, transfer your bank accounts, and incur higher communication costs to stay in touch with your friends and family.
Some people decide to retire in other states or abroad to fulfill their wish of exotic living. Take this route only if you are comfortable with your financial situation. You should remember that taxes differ from one place to another and it would be an important consideration, as you would still be receiving some cash flow from your investments. Look for tax breaks on pension incomes and age-related tax exemptions when you are choosing a different state.
When researching on whether the cost of living is affordable, do not forget to consider health care costs. You might ignore these aspects initially, but the last things you want is an illness to ruin your savings.
Another factor that you need to consider is the climate of the region where you are moving to. If you move to a place that is too cold, you would have to pay a large amount as heating bills, and if the place is too hot, you would have to make an expense on air conditioning.
If you plan to move to a different country, then ensure that the currency of the region is stable and they have a good economy. Financial instability of a region can have a serious impact on your standard of living and it will also affect your savings if you convert them to the local currency.