"Some countries actively court foreign retirees—dangling benefits beyond the built-in perks like low-cost living, warm weather, friendly locals, and beautiful surrounds," says Jennifer Stevens, Executive Editor, International Living.
"Countries like Panama, Costa Rica, and Ecuador, for instance, offer low-barrier-to-entry residence visas for retirees, tax incentives, and senior discounts on everything from airfares to utilities to medical treatments," says Stevens. "It makes sense. They can attract expats who have US dollars to spend but who won't take a job from a local. It's like turning on a spigot allowing outside money to flow into the economy. And, in turn, the retirees improve their quality of life while they lower their cost of living."
These special places actively attract expat retirees by offering benefits and discounts like tax breaks, lower prices for services, and easy residence requirements.
The three countries that rank the highest in the Benefits and Discounts category in International Living's 2021 Annual Global Retirement Index are Panama, Ecuador and Costa Rica.
# 3. Costa Rica
In third place, with 88 points, is Costa Rica.
When potential expats research Costa Rica, the benefits often heavily outweigh any perceived drawbacks.
Costa Rica is a country where the older generation is treated with respect by custom. And things like head-of-line privileges at banks and government offices are inscribed in the law. But there is also a government program available to those age 65 or older that gives discounts on a variety of products and services
"Being 'Viejo' or old is a rite of passage, a badge of honor in Costa Rica," says Kathleen Evans, IL Costa Rica Correspondent. "And you will see simple things like seniors going to the front of the line—any line, enjoying special early shopping hours, free bus rides, and the Ciudando de Oro or Golden Citizen card."
The Ciudando de Oro offers discounts from two to 20% from over-the-counter medications to groceries, and eyeglasses to clothing. You have to be 65+ and have to be resident to qualify.
"Even without residence, some expat community's restaurants will offer a local night cash discount where food and drinks can be as much as 25% off regular prices," says Evans.
Costa Rica is also home to the Caja Costarricense de Seguro Social (or simply known as the Caja), the country's national healthcare system, which has been cited as a successful model for Latin America.
"Once you have been approved for residence in Costa Rica, you pay a percentage (typically seven to 11%) of your reported monthly income into the system and then you have access to public healthcare without a co-pay, age restrictions, or denial for pre-existing conditions," says Kathleen.
"If you choose to self-insure out-of-pocket—to simply pay for any needed treatment—this typically saves anywhere from 15% to 80% when compared to the same medical procedure in the U.S. at private hospitals."
# 2. Ecuador
Ecuador, the Land of Eternal Spring, takes second place in this Benefits and Discounts category of IL's Index with 95 points.
Although Ecuador does not have an incentive program designed specifically for foreign residents, like Panama's pensionado program, it does offer significant benefits to all residents age 65 and older.
Ecuador's constitution guarantees foreign residents the same rights as their citizens, so expats can enjoy the same benefits as locals.
"When I first got to Ecuador I was left frustrated by a lot of older women cutting in line in front of me at banks, grocery stores, and public services office," says Donna Stiteler, IL Ecuador Correspondent. "Then I realized I was entitled to the same treatment. If you're a senior citizen, you can use the much shorter Preferencia line…so you'll have more time to relax and enjoy your retirement in Ecuador.
"As a resident in Ecuador, the government offers a variety of benefits including 50% off public and private transportation within the country, 50% off tickets for all cultural and sporting events, including movies, a discount on electric and water bills and a reduction in a variety of taxes, including a refund of your 12% IVA (value-added) tax up to $92.64 per month."
The best of the benefits for most expats in this category are discounted rates on international and domestic airline tickets.
"You can also get a discount of 50% off airfare (not including airport fees, fuel surcharges, tax, etc.) for international travel on some airlines," says Stiteler. "I never thought turning 65 would be so profitable."
For foreign residents traveling to the U.K., Canada, or the West Coast of the U.S., savings can amount to thousands of dollars a year. To take advantage of the discount, international flights must originate in, and return to, Ecuador.
# 1. Panama (Winner)
Panama claims top ranking in the Benefits and Discounts category, scoring 96 points out of 100, in International Living's 2021 Annual Global Retirement Index.
Panama's Pensionado Program is designed specifically to attract foreign retirees. The requirements are intended to ensure that members are able to live well here, rather than just eke out an existence. That's why being a resident pensionado in Panama also grants you access to a long list of government-mandated discounts. These have been in place for decades, helping locals and foreign residents on fixed incomes live their lives with dignity, as active members of society.
Retirees in Panama get 50% off entertainment, such as movies, theaters, concerts, and sporting events. Hotel stays, restaurant meals, and transportation—bus, boat, train, and some airline fares—are also 25% to 50% cheaper when you're a retiree resident. It's an important reason why, in Panama, you see people of all ages dining out, going dancing, attending shows, exploring the country, and partying together.
Pensionados often have their own lines at banks and government offices. Even if there isn't a dedicated line, staff and customers alike tend to wave retirees forward. There's a certain level of respect and inclusion—two markers of a happy, healthy society.
"When my wife, Abbe, and I looked to retire overseas a few years ago, I found that Panama's excellent Pensionado Visa or Retirement Program was a great way to stretch my Social Security pension," says IL contributor Jim Gault. "We have used the hotel discount several times, recently staying two nights for the price of one at an exotic beach resort."
While the pensionado discounts don't cover every aspect of life, they cover the most important ones. Medical savings include 15% off hospital bills, 20% off prescription medicines, 20% off medical consultations, and 15% off dental and eye exams. Jim and Abbe have saved money on everything from ophthalmologist and orthopedic specialists to lab tests, digital X-rays, a yearly mammogram and an open MRI.
"When I had a cardiac event and had to have a small stent placed into the right side of my heart, the doctor, hospital, and insurance experience were all exceptional. I believe I had a much different and better experience than I would have had in the U.S.—and at a fraction of the cost," Jim adds. "The doctors in Panama give you their cellphone and WhatsApp number. You can contact them and they will usually respond very quickly. Does that happen where you are from?"
All the things that really matter are discounted so retirees can maintain their pre-retirement lifestyles. And the rest is incredibly affordable—from property taxes and car insurance to tooth fillings and hired help. That's pretty amazing, when you consider everything Panama has to offer. Where else in the world is this warm, safe, modern, and accessible…while also offering a truly cosmopolitan capital, cool mountain town, pristine beaches and islands…all outside the hurricane belt? Very few places can even come close to providing this kind of value.
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