Don’t check your brain at the border
I always believed in the maxim, “diversify your investments”. So during our working careers, my wife and I used to buy real estate, especially south of the border.
When it was time to retire, we chose to live at least half the year on the shores of Lake Chapala, Mexico. Lake Chapala is about the same elevation as Denver, Colorado, but it rarely gets this cold. There is a brief mild winter, but most houses do not have heating or air conditioning.
Due to the ideal climate and prices that are still less expensive than in the United States, this has become a popular retirement community with people from all over the world, but especially from the United States and Canada. The ex-patriots in Mexico number in the millions of thousands.
As the baby boom generation ages, this and other places like the island of Roatán in Honduras, Costa Rica, the coasts of Mexico and, of course, most of the Caribbean will become more popular – and more expensive – among retired.
These are ideal retirement locations and I do not mean to discourage anyone from considering them. But don’t check your brain at the border.
Except for Puerto Rico, these are all foreign countries. Not everyone speaks English and things are done differently.
If you’re considering a second home and make inquiries, you’ll quickly become familiar with the large population of realtors in these locations. Surprisingly, most of them will be very friendly Americans or Canadians, willing to treat you to food and drinks, introduce you to the local expat community, and explain the ins and outs of life abroad.
About a year ago, International Living published an article titled: “Not All Sharks Swim Underwater.” It was about expatriate real estate agents and the stories they tell. And this is where the location of your brain becomes critical.
Take everything they tell you with a grain of salt. Hang out at any local pub and you are likely to meet disgruntled expats who are disgusted with where you are. Also take what you’re told with a grain of salt, but carefully consider both sides of the image.
When you are traveling, you are on vacation. It’s all fun and games. You meet new people, you party and you drink too much. You go sightseeing and have a great time.
But living in these areas can be very different. Telephones and electricity may not work all the time. Internet service can be spotty. You may need to pump and purify your drinking water.
There may be disputes with the native population, which you will usually lose.
There will be plenty of sharks, usually expats, who will be more than willing to take advantage of your naivety.
So some tips:
1. Don’t believe everything they tell you. Check everything with as many different sources as you can. And if it sounds too good to be true, it probably isn’t.
2. Remember that you are a guest in a foreign land. Don’t act like a spoiled brat. The cultural gap can be huge. And even if a local resident speaks English, there are often misunderstandings due to that cultural gap.
3. Don’t invest your money with a friendly block you meet at a local bar, no matter what return they guarantee. In fact, keep your money in the states or Canada, safely stored at a reputable bank or brokerage firm. If you want to keep some local currency on hand, open an account at a real bank. Keep the same meter you had in the states or Canada.
4. The laws are different. In many countries, a Notary will handle both sides of a real estate transaction. But he still has the right to hire his own lawyer, interpreter, and building inspector and surveyor. You’d be surprised how many people don’t, I know I didn’t. And in many countries, attorney-client confidentiality and conflict of interest are unheard of.
5. While most of the native population will respect you if you return the favor, you’ll be targeted by local thieves. Crime will probably be lower than anywhere you come from, but it does exist, especially burglary and car theft. You may also find yourself resentful of the more affluent local population. It can be difficult to become friends with them.
6. Try to learn the local language and customs. Do not try to impose your values and be careful where you try to meddle.
7. In many places, the only thing you will have in common with other expats is language. So make sure you choose a place with a large enough expat community for you to make friends. For the most part, there will be plenty of warm and welcoming people willing to include you in their social circle.
8. Be prepared to deal with poverty, people living in terrible conditions, child labor, and more. There will be many groups to help, but there never seems to be enough to put even a small tooth into the problem. Some of the problems are due to the local culture and there is nothing you can do about it.
There is no place like paradise, at least not in Mexico, South America or the Caribbean. You can live a very nice lifestyle, but nothing is perfect.
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