Panama, the new Florida
PANAMA. Panama is increasingly popular among retirement-age types looking to hedge against— or skip out on— the recession, says a write...
PANAMA. Panama is increasingly popular among retirement-age types looking to hedge against— or skip out on— the recession, says a writer in the US magazine, BusinessWeek.
The country’s quality health care, low costs, and proximity to the states are still attracting American professionals as a retirement haven, with Americans who are looking for a better bang to their buck setting their eyes on Panama, says Michelle Conlin.
The Migration Policy Institute, a Washington-based think tank that studies the movement of people around the world, says the chief factors prodding professional-class Americans to move to Panama include its First World health care available at Third World prices and the country's pensioner program, which offers some of the deepest retiree discounts in Latin America.
Seniors get big discounts on nearly everything, including movies, motels, doctors' visits, plane tickets, professional services, and electric bills. Expats also pay no tax in Panama on foreign income. Nor are they required to pay property tax for the first 20 years.
The fact that a luxe beach-front manse can be had for the same price as a dump in Daytona doesn't hurt, either. “We would have been looking at $3 million in Miami,” says Jon Nickel of his 3,000-square-foot oceanfront penthouse in Panama City.
The skinny isthmus boasts some of the best weather and lowest crime rates in Latin America. Other draws include guilt-free conspicuous consumption, with laughably low prices— by gringo standards— on splurges such as a day of beauty ($10) and a maid ($15 a day). A complete blood work-up at Panama City's gleaming new Hospital Punta Pacifica, managed by Johns Hopkins Medicine International, is $36.
A checkup with a physician is $50. Boomers who say they would have had to pay roughly $1,200 a month in the US for health care say they are paying roughly $800 a year for coverage in Panama.
Barbara Dove, a 66-year-old who suffers from Parkinson's disease, worried that she would eventually need in-home care if her condition deteriorates. Researching rates in Seattle, she found that nurses run $25 an hour. In Panama City, where she has lived since 2007, they cost $25 a day.
According to the president of the Migration Policy Institute, Demetrios Papademetriou: “With Americans aging, the economy in shambles, and, possibly, Medicare benefits on the cutting block, it is reasonable to assume that more Americans will retire abroad, particularly to warm, sunny locations such as Panama, where they can get more value for their dollar.”
That's not to say life in Panama suits everyone.
Things in Panama mover really slowly. A repairman who says he will be right over might show up days later. Water and electricity service can be spotty. In Panama City, drivers treat stop signs as a mild suggestion.
“It takes a little bit of balls to retire here,” says Matt Landau, a New Jersey native who is the founder of Panama City-based online portal The Panama Report.
“This is not for type As. It's not your turnkey Florida retirement.”
Still, boomers who have recently relocated to Panama say they feel as if they have figured out a successful geographic arbitrage.
When Stephen Johnson and Linda Murdock were living in Aromas, Calif., they used to moan half-jokingly about how they'd have to retire to Barstow— the armpit of the Mojave Desert, with summers in excess of 100 degrees and winters that can dip below freezing.
Over late-night pinot noir on their patio, they started talking about moving to a developing nation to stretch their money further.
They had discovered Panama on a trip there in 2004 and saw it as a bargain-basement paradise.
Still, there are tradeoffs in this seemingly easy life. “Paradise is just a place you visit,” says Johnson. "If you live here, you begin to see the cracks.”
Those include the three months it took them to get their driver's licenses— a process that involved blood tests, a hearing exam, and lines that make a US Motor Vehicles Dept. seem like a fast-food joint.
But Johnson and Murdock have no major complaints, and Panama is certainly better than the Mojave.