According to a Pew Research Center survey, two-thirds of American workers aged 65 and older report high satisfaction with their jobs, surpassing the rates of their younger counterparts. Retirement age is increasingly flexible, allowing "semi-retirees" to maintain some professional activity. Additionally, this period often prompts some individuals to move abroad. How can one effectively manage this transition?
What is "semi-retirement"?
"Semi-retirement" refers to a phase where individuals scale back their work engagements as they approach or surpass retirement age. This adjustment may occur to disengage from full-time work gradually or, conversely, to extend their careers due to financial needs or the desire to stay active.
Tim Golas, partner at Spurstone Executive Wealth Solutions, remarks, "After a lifetime of hard work and stress, retirement can be daunting, even for those with significant savings. The challenge lies in how to invest time and continue to find meaning in life, particularly when one's identity has been closely tied to their career."
Moreover, the U.S. Bureau of Labor Statistics predicts a notable increase by 2030 in the workforce aged 75 and older, a trend that extends beyond the United States.
Who can consider a semi-retirement abroad?
Essentially, anyone can choose semi-retirement abroad, provided they can arrange to continue some form of professional activity while approaching or being at retirement age. This could involve starting a new part-time job in a foreign country or maintaining their current profession through remote work.
What professions are suitable for semi-retirement?
Virtually any profession can be adapted to semi-retirement if it offers sufficient flexibility. Suitable fields include teaching, project management, accounting, graphic design, and consulting, especially if the tasks can be performed remotely or abroad. Entrepreneurs also make excellent candidates for semi-retirement, as managing a business does not necessarily require constant on-site presence, allowing for various work arrangements.
Many semi-retirees seek flexibility, as illustrated by one photographer's experience: “When I turned 70, I reduced my workload but didn't fully retire. I still run my photography business and take on projects as they fit into my schedule and interests."
What type of visa allows semi-retirement abroad?
For EU citizens planning to semi-retire in another EU country, no visa or residence permit is required. However, for other destinations, obtaining a visa is essential. Many countries offer specific retirement visas, although these often limit the holder's ability to work. It's crucial to review the specific conditions for each country.
The digital nomad visa is an alternative available in around forty countries, including Dubai, Spain, Mauritius, Thailand, and Brazil. This visa suits individuals who operate a business or are self-employed in their home country and can work remotely, with income sourced from outside the host country. Other options include visas for skilled workers or those encouraging investments in the host country. To determine the best fit, thoroughly research visa and immigration policies for your chosen destination.
Can I receive my pension abroad?
You should be able to receive your pension while living abroad, even if you continue to work part-time. However, there may be limitations on how much additional income you can earn, depending on the specific rules of your pension system. To receive your pension abroad, you must notify your pension fund of your new residence by providing proof of address.
Where will I pay my taxes during my semi-retirement?
Your tax obligations during semi-retirement depend on several factors, including the nature of your activities and your ties to your country of origin. Fiscal residency is determined based on criteria like the number of days spent in a country each year and the location of your main economic interests. You'll need to evaluate these factors to determine where you will be taxed.
It's crucial to check for a tax treaty between your home country and your intended country of semi-retirement. Without such a treaty, you could face double taxation. Always consult with a tax professional to navigate these complexities effectively.
Criteria for choosing the country for your semi-retirement
Selecting the correct country for semi-retirement involves balancing personal preferences with practical considerations. Consider these key questions:
- Which countries resonate with you culturally and linguistically?
- What other factors matter to you, such as climate, lifestyle, quality of life, security, and proximity to your home country?
- Which countries offer opportunities in your current field or the field you wish to enter?
- Does the country offer a visa that permits semi-retirement work?
- Is the cost of living manageable, given your expected income?
- Is there a tax treaty between the country and your home country to avoid double taxation?
- How does the healthcare system rate, and are medical services affordable?
Answering these questions is a vital first step. It's also wise to test the waters and start building a local and online network before making a final decision.
