Panama, a stunning Caribbean facing country located in Central America, is already a very popular choice with our North American cousins who are looking for an affordable and attractive place to live, work or retire. In part this is because Panama is far more easily accessible from the US and Canada than it is from Europe for example, and is so more widely known – and in part it’s because America has very strong ties with Panama thanks to the strategic importance of the Panama Canal, and so the nation has been in the American/Canadian conscience for a long time.
However, Panama is not a country explored by many Britons, and until recently it has remained a much less popular choice for retirees for example, who were looking around the world for an affordable retirement hotspot. Things are beginning to change though… Europe is no longer a realistic option if you want true affordability, and those in the know are beginning to see real opportunity in Panama that needs promoting more widely.
We have been speaking to Jack and Ruthie Burns, Shelter Offshore readers who have permanently settled in Panama following detailed exploration of multiple nations - from Canada to Costa Rica. They have provided us with an exceptionally valuable and detailed overview of what life is really like in Panama for retirees for example – and so in this article, we’re going to use their findings to help you determine whether Panama could be your perfect low cost retirement paradise…
First things first let’s cut to the chase – Panama is sandwiched between Costa Rica and Columbia and it’s in Central America. For Britons that rings all sorts of ‘drug smuggling,’ ‘high crime’ bells! So we asked Jack Burns, a Panama resident, former Canadian citizen and son of British parents, whether he and his wife Ruthie feel safe in Panama: -
“Absolutely!!! We live in rural Panama though and this makes a large difference. Living in Panama City is another story and living in Colon, (the 2nd largest city), is a disaster!!! But living in David, (3rd largest city), is great and this is where we do our major shopping and it has all of the amenities and facilities you could want - like the restaurants, bars, theatres, shops etc. When we lived in David (when we first arrived in Panama) we frequently walked around at 10 or 11 in the evening and never felt threatened. Are there bad areas - yes, are there some bad people - yes. Did we ever feel threatened – absolutely no!
“What’s more, when we were travelling widely to find the right nation for us to settle in for retirement, the one thing we were looking for was a country with a good level of security that made us feel welcome and where we felt we could “fit in.” Trust me, it is no fun when you are always considered and treated as an “outsider.” When living in one location (in the northeast Caribbean region for 4 years) and I worried every time my wife went shopping - and that was in the middle of the day. That is no fun and no way to live! So for us, Panama feels very safe indeed.”
In addition to needing to live in a nation where they felt safe and welcome, we asked Jack and Ruthie what other criteria they had when searching for their retirement destination…and whether Panama fulfilled these criteria or not: -
“We looked for the right country for almost 12 years. By looking I mean, visiting different locales in the Caribbean, living in them and in most, either working for someone or we set up our own business. It is impossible to decide upon a location based on a “short visit.” There were specific requirements that had to meet our level of tolerance: -
“1) It had to be WARM – having lived in Canada I have a given right to despise cold weather!
“2) There had to be no discrimination (at least outwardly visible) towards us. Most of the northern and eastern Caribbean countries showed a definite “dislike” for permanent foreigners for example!
“3) The government had to be open to foreigners. Again, the northern and eastern Caribbean made moving to and retiring or working there very difficult if not impossible. It seemed to me like they like it when you just bring money and then go back home.
“Panama has open arms for foreigners as retirees, investors or business owners.
“4) There had to be an infrastructure that worked - at least most of the time! This includes roads and electric etc.
“5) It had to be cheap. I would like to say ‘inexpensive’ but I really mean cheap! We don’t have a lot of money! You can get some good deals on different things in the various areas but we needed a location that had an overall low cost of living. Panama’s pensionado program is without rival. There are a multitude of special prices on everything from prescriptions, to restaurants to services for retirees as a result.
Obtaining legal status here so that you qualify for these benefits as a retiree is very simple - time consuming, but simple!
“6) There had to be good medical facilities. Some of the countries we lived in made us fearful of ever getting ill or injured. My wife is a cancer survivor so a level of comfort with doctors was a definite must for us!
“7) We had to like being there! This may sound dumb but, there were some places that met most of our requirements but we didn’t like them for whatever the reason. Usually that “reason” developed AFTER living there for an extended period. It starts out being good but as you become more entwined in the daily routines you can become turned off by a country. You don’t want that when you make a selection for a new country.
“Choosing a new country to retire to is probably the hardest choice for many people, and some expats give up and return to their home country because they find they miss what they grew up with – but it is normal to feel that it was better “back home” for a while when you relocate! You just have to get past this period otherwise you end up being like many people I have known who have given up and returned to their old country only to realise that actually, their new country choice was a good one and the problems in their new country are pretty much like those that exist in their mother land - except that the new country costs less!”
Having determined that Panama is safe if you pick the right location, it has decent healthcare, it’s weather is warm and the people are welcoming to the point at which the government has a ‘pensionado program’ that foreign retirees can qualify for and benefit from…we wanted to push the ‘affordability’ question further.
Currently many Britons are cash strapped and struggling economically speaking – this situation doesn’t look like it will improve in the near-term. As a direct result many Brits want to leave, they want to retire overseas to a decent country where the weather is better and where it is cheaper to live…so how affordable is Panama? According to Jack Burns: -
“This is a two part question. The basic monthly income to become a pensionado or retiree with all of the benefits is stipulated by the government. Currently it is $1,000.00 (U.S.) per month for an individual and an additional $250 per month for a dependent. So $1200 per month for a retired couple.
“The beauty of this is that this amount must only be VERIFIABLE it does not have to be brought into the country. This is in contrast to some other countries where you must deposit to a national bank the monthly amount. The government here loves it when you have a government pension from your home country, it is the best and easiest way to qualify. But we had to buy an annuity with our pension to provide us an income and we had many hoops to jump through as they are not familiar with annuities in this country.
“So, if you can easily prove you will have $1,200 coming in a month, [that’s about £776 with the current exchange rate], you will qualify for the pensionado programme and it is well worth applying.
“However, that doesn’t mean you need that much to live on!
“If I get out my last grocery bill I can tell you the following costs – but please don’t interpret the following as being our normal weekly diet! [Note all costs are in US dollars and the exchange rate is currently $1 = £0.65]
“1) Beer- $8.25 for 24 bottles if it’s warm and $9.25 if it’s cold - I love this country!
2) Spirits on average about $13.00 for 1.75 litres.
3) Chicken breasts $1.29 per pound
4) Potatoes $0.46 per pound
5) Loaf of whole wheat bread $1.68
6) Small pork chops - no bone $3.29 per pound
7) Case of ginger ale $6.59
8) Bag of “snow peas” $2.78
“People should please note that better deals can be found by shopping around – especially for vegetables and fruits. For these it’s best to visit the farmers’ markets in local town squares. You’ll get limes for $0.05 each, watermelon for $0.50 – and everything like tomatoes etc., are all very cheap. The local produce can vary in quality depending on the time of year however. But near David where we live, we have hydroponic gardening and the produce is excellent year round.
“If you buy items like eggs and whole chickens from the locals then they are also even more reasonably priced. Just remember that a ‘whole chicken’ may be just that!
“So, over all I would guess a couple could eat VERY well on just $100 per week – and that includes beer!”
The only other major concern that a would-be retiree will have when beginning their detailed research into a new nation will be finding decent, affordable, attractive and comfortable accommodation. So we decided to ask Jack Burns about property in Panama. And Jack is certainly the right man to ask…he and his wife Ruthie have established an affordable development of homes in a stunning part of Panama. Their development is 100% debt free – i.e., they own the land and are not mortgaged to develop their properties. As a result a buyer can have complete confidence in the development – rare in this day and age.
The development is located close to David, the 3rd city in Panama and one of the most desirable…and Ruthie and Jack are on site, maintaining the properties for their residents and managing the entire development. Here’s what Jack has to say about their Villa Davina project: -
“Ruthie and I never really set out with a development in mind. We were looking for a place to build a home for us and maybe a couple of little casitas for when the kids and grand kids came to visit. How we ended up building a development is still a bit of a mystery! Simply put, we were self employed for most of our working lives and failed to build for our retirement because we kept doing dumb things like buying groceries, and equipment for the business and the ultimate extravagance - paying ourselves a wage.
“As we travelled in search of a place to live where we could AFFORD to live we realized that there were many people just like us. This became the drive when we decided upon a development. We wanted to build quality homes at truly affordable costs.
“I am asked all of the time – ‘why so cheap?’ The answer is simple. Firstly we are not profit driven. Secondly, I believe that it is far better to receive $5 per month from a thousand people than it is to try and pursue $5,000 per month from a single individual. The rationale is easy - if one person drops out you are not hung out to dry! Our development is built with an ‘annual recurring revenue’ in mind.
“How do we do this? Well, we own and maintain the services such as the electrical grid, water supply, internet etc., on our development. You, as a buyer in the development, pay for your services just like you do now in your current home. There is a connection charge that is fixed and then you pay on a consumption basis. For example, the electrical service has a base price of $20 per month regardless of the consumption. The rates per KW vary depending on the fuel costs and this is set by the government. Currently the cost per KW in the development is $0.22 per KW including tax.
“We receive a monthly bill from the utility as the development has a single consumption meter. We then read the individual meters, charge the owners based on consumption and then we pay the government. So we make $20 per month per connection for servicing it, maintaining it and making the payments to the government. This is $20 profit per month for us, per unit.
“The water has a $10 per month fee regardless of the consumption etc. To do this in other parts of the world is not doable - here it is. So we make a little bit of income on each buyer/renter every single month. We also provide a management service if you wish us to rent out your unit when you are not here etc. The monthly fees on our homes also includes exterior maintenance and grounds upkeep.
“Our area is rural Panama just 20 minutes from the border with Costa Rica. We are not surrounded with restaurants and stores. You must travel to Bugaba or David for that. We like country living. Our access road is rough but passable year round and the development of our own infrastructure is ongoing. All of this means that the land you’re buying a home on is affordable, and we pass this affordability on to our buyers.
“Our development is completely debt free and will stay that way. Positive cash flow is the only way to stay alive in business especially in today’s economy.
I do not build on speculation and I only add to the infrastructure as I sell the units. Having no debt to service allows us to keep our prices down.
“This probably sounds a bit odd coming from the developer but it is the truth and I tell all of our buyers the plain and simple truth! If you want all of the parks and fancy paved roads etc., immediately then go to Boquete or David but be prepared to pay 3, 4, 5 or more times as much.
“If someone is looking for a safe place to live surrounded by nature at probably the best price in Panama, then we are the place to consider!”
Jack and Ruthie’s development is already proving popular with those who have explored all Panama has to offer – but if you’re new to considering this stunning, affordable and accessible country, visit http://www.easyretirementliving.com/ which will tell you absolutely everything you need to know about this development where prices start at £53 per square foot, and where a completed condominium can cost you as little as £52,000.
